By Trevor Damyan, Commercial Mortgage Broker at Commercial Lending Solutions
A $20 million data center construction loan finances a small to mid-size enterprise or colocation data center, typically 5 to 15 megawatts of IT load. Data center construction is among the most capital-intensive CRE asset classes at $1,200 to $2,500 per square foot reflecting power infrastructure, cooling, redundancy, and security. Most $20M data center construction loans fund through specialty data center lenders, life co construction-to-perm with credit-tenant pre-leases, or bridge debt funds for speculative development.
Get a Quote on Your $20M Deal →$20M data center construction stacks combine senior construction debt with institutional equity. Pre-leases to credit tenants (hyperscalers, enterprise) materially affect financing terms and pricing.
Pricing reflects active CLS CRE quote pipeline as of April 2026. Specific deal pricing depends on sponsor, property, and structure.
Typical $20M data center construction sponsors are specialized data center developer-operators with completed projects and credit-tenant relationships. Sponsor net worth $20M to $200M+. Capital structure typically includes $13M to $15M of construction debt at 65 to 75 percent LTC, $7M to $9M of common equity, and $1M to $3M of sponsor co-invest.
On a $22M ground-up 8 megawatt enterprise data center construction in a Sun Belt market with a 12-year pre-lease to a Fortune 100 enterprise tenant covering 6 megawatts at full lease-up, the sponsor financed through a specialty data center lender at SOFR + 425 (8.85 percent all-in), 70 percent LTC ($15.4M loan), with the pre-lease providing credit support for the take-out at stabilization. Construction took 22 months. Permanent take-out via life co at 6.85 percent fixed 10-year at month 25.
Anonymized. All deal references protect borrower and lender identity.
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