It is reported that Morgan Stanley is leading a syndicate to divest $15 billion in AI data center debt: Although backed by Google, the bonds are expected to remain speculative grade

Zhitong
2026.08.05 08:25

Morgan Stanley leads a syndicate to divest approximately $15 billion in AI data center debt, a project endorsed by Google. Despite the support, as the guarantees only take effect upon completion, the bonds are still expected to be speculative grade. This move aims to reduce the banks' risk exposure and free up credit space. Currently, the surge in financing for AI infrastructure by tech giants has led to signs of "indigestion" and investor fatigue in the global bond market

According to reports, a banking consortium led by Morgan Stanley (MS.US) is preparing to sell approximately $15 billion in debt related to a data center project supported by Google (GOOG.US) that is leased to the AI startup Anthropic. Even with Google's endorsement, these bonds are expected to be rated as speculative grade.

This financing is related to the 2,000-acre data center park being developed by Nexus Data Centers in Hubbard, Texas. The park will deploy Google TPU chips, and Anthropic will sign a long-term agreement to lease the facility, with Google providing support endorsement.

Reports indicate that this refinancing will help banks remove this debt from their balance sheets, reduce their risk exposure in AI infrastructure financing, and free up more credit availability.

The $15 billion financing is expected to be refinanced through multiple bond issuances, with Nexus Data Centers drawing loans in phases after reaching construction milestones. Some of the debt may also be refinanced in the leveraged loan market.

Insiders revealed that despite Google's support, these bonds are still expected to be rated as speculative grade. The reason is that Google's guarantee only takes effect after the data center is completed, and investors still need to bear risks related to project construction and cost overruns.

Currently, the financing demand for data center projects continues to squeeze the traditional infrastructure credit market, with more banks turning to the bond market for refinancing large AI infrastructure loans.

Since 2026, the volume of debt issuance for AI infrastructure financing by tech giants has surged, leading to noticeable signs of "indigestion" and investor fatigue in the global bond market. Media reports in July indicated that Alphabet, Amazon, Meta, Oracle, Nvidia, and SpaceX, six "AI hyperscale computing companies," have cumulatively issued approximately $244 billion in bonds in the global bond market this year, more than double last year's total of $108 billion and over 14 times the $17 billion expected in 2024.

Due to oversupply, newly issued bonds have quickly softened in the secondary market. The spread on 10-year bonds from Alphabet and Meta has significantly widened, far exceeding the increase in the average spread of overall investment-grade bonds, reflecting that investors are demanding higher risk compensation. Goldman Sachs investment-grade bond trader Jeffrey Papai bluntly stated that the issuance of AI-related bonds has left the market "fatigued from digestion."

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