Hot Picks: AI demand boosts data centres as real estate improves
BNN Bloomberg interviewed Ji Zhang of Cohen & Steers, who said AI infrastructure spending is boosting demand for data centres while limited new supply and improving leasing support office and retail. Zhang cited stronger leasing, higher rents and tighter availability in major markets for premium offices, and said retail is benefiting from years of constrained supply. Picks mentioned: Boston Properties, Blackstone Digital Infrastructure Trust (BXDC) and RioCan.
How this was made
The 30-second read
Why it matters
The article is a thematic “Hot Picks” interview that argues for selective re-rating in office quality, data center ownership vehicles, and prime retail—without providing new filings, guidance, or transaction specifics.
Market read
Useful for positioning around the AI infrastructure read-through and the office/retail quality bifurcation, but it does not introduce new, tradable disclosures.
What to watch
Key risks not quantified here: financing/cap-rate sensitivity, lease rollover concentration, hyperscaler tenant concentration for data centers, and retail demand elasticity if consumer spending weakens.
Background
Cohen & Steers portfolio manager Ji Zhang discusses how AI infrastructure spending is boosting data center demand while office and retail fundamentals improve amid constrained supply and steadier rate expectations.
Ticker impact
Blackstone Digital Infrastructure Trust (BXDC) is presented as a public vehicle owning stabilized mission-critical data centers leased to hyperscalers, directly tied to AI capex demand.
Moderately positive; valuation sensitivity to cap-rate/financing conditions and data center demand durability.
The article provides a concrete investment mechanism (capital provider/owner of stabilized data centers) but no new company-specific filing or transaction.
Market effects
Reinforces a “quality bifurcation” trade in office (trophy/Class A outperform) and a supply-constrained tailwind for prime retail; supports the AI infrastructure read-through to data center owners.
Emphasizes New York and San Francisco office tightness (rents/availability) and broader urban-market leasing strength.
AI capex and hyperscaler demand are treated as a global secular driver for data center asset demand and acquisition pipelines.
Counterpoint
AI may still pressure office demand over time; the interview’s “on-the-ground” leasing strength could be cyclical or concentrated in specific submarkets rather than a durable re-rating.
Key entities
- portfolio_managerJi Zhang
Portfolio manager of global real estate at Cohen & Steers, quoted on AI-driven data center demand and improving office/retail fundamentals.
- vehicleBlackstone Digital Infrastructure Trust
Public vehicle described as owning stabilized mission-critical data centers leased to hyperscalers (BXDC).
- companyBoston Properties
Office REIT described as seeing a resurgence in leasing, rents, and occupancy (BXP).
- companyRioCan
Canadian retail REIT described as benefiting from constrained supply and renewed pricing power (RIOCAN).
