Portfolio Acquisition Strengthens H5’s Multi-Market Infrastructure Strategy
H5 Data Centers has completed the acquisition of three strategically positioned data centers from 365 Data Centers, marking a significant expansion of its national infrastructure footprint. The transaction, executed through a joint venture with digital infrastructure investor Novacap, brings highly interconnected facilities in Buffalo, New York, Nashville, Tennessee, and Tampa, Florida under H5’s operational umbrella.
The acquisition represents more than a simple asset transfer—it establishes H5 Data Centers as an immediate presence across three high-value regional markets while advancing the company’s broader vision of developing robust interconnection ecosystems throughout North America. Each facility functions as a critical network hub within its respective metropolitan area, providing the carrier-dense connectivity infrastructure that modern enterprises, cloud providers, and artificial intelligence workloads increasingly demand.
This marks the second collaborative portfolio acquisition between H5 Data Centers and Novacap, following their January 2024 purchase of a U.S. wholesale data center portfolio. The partnership demonstrates sustained commitment to building a diversified digital infrastructure platform capable of serving next-generation computing requirements.
Why Interconnection Density Matters in Regional Data Center Markets
The three acquired facilities share a common characteristic that distinguishes them from standard colocation assets: deep interconnection ecosystems built over years of operational history. In data center infrastructure, interconnection density—the number and quality of network carrier connections available within a facility—directly impacts latency, redundancy, and the ability to support complex hybrid cloud architectures.
Buffalo, Nashville, and Tampa each represent secondary markets experiencing substantial growth in data center demand driven by enterprise cloud adoption, content delivery network expansion, and emerging artificial intelligence workloads. These markets offer geographic diversity, favorable regulatory environments, and proximity to major population centers without the land scarcity and power constraints increasingly prevalent in primary markets like Northern Virginia or Silicon Valley.
According to Josh Simms, CEO of H5 Data Centers, the facilities align precisely with the company’s operational focus. “These facilities are important digital infrastructure assets with deeply interconnected ecosystems and long-standing customer relationships,” Simms stated. “They fit within our focus of owning and operating data centers that support carrier networks, digital content distribution, and the next generation of cloud, AI, and enterprise workloads.”
Strategic Rationale Behind the Transaction
For H5 Data Centers, the acquisition delivers immediate scale across multiple geographies while preserving the continuity of established customer relationships and carrier partnerships that define each facility’s value proposition. Rather than pursuing greenfield development—which typically requires 18-24 months before revenue generation—acquiring operational facilities provides immediate revenue contribution and platform expansion.
Ted Mocarski, Senior Partner and Head of Digital Infrastructure at Novacap, emphasized the transaction’s strategic fit: “H5 Data Centers brings deep operating expertise and a clear vision for building highly interconnected data centers. This transaction fits squarely within our strategy of building a diversified portfolio of high-quality digital infrastructure assets.”
Implications for 365 Data Centers’ Portfolio Strategy
The divestiture enables 365 Data Centers to sharpen its operational focus and redirect capital toward higher-density, hyperscale-oriented facilities within its remaining portfolio. Derek Gillespie, CEO of 365 Data Centers, confirmed this strategic pivot: “The sales proceeds will further enable 365 to expand and deliver higher-density MW services at a number of our larger facilities.”
Bob DeSantis, Co-Founder and Board Member of 365, noted the transaction “aligns perfectly with the company’s and its investors’ strategic objectives and provides management with the financial flexibility to achieve them.”
As digital infrastructure continues fragmenting into specialized operational niches—from edge computing to AI-optimized facilities—strategic portfolio realignment through acquisitions and divestitures allows operators to concentrate resources where their competitive advantages deliver maximum value.
About H5 Data Centers
H5 Data Centers is a leading owner and operator of data center properties across North America, delivering secure, reliable, and efficient colocation and wholesale solutions to enterprise, network, cloud, AI and hyperscale customers. H5 is focused on operating critical infrastructure assets with long-term value, strong connectivity ecosystems, and best-in-class operational execution.
For more information, please visit https://h5datacenters.com/
About Novacap
Novacap is a leading North American private equity investor and one of Canada’s most experienced private equity firms. Founded in 1981 to partner with visionary entrepreneurs, Novacap focuses on control buyouts of middle market and lower-middle market companies across four core strategies: Technologies, Digital Infrastructure, Industries and Financial Services. Novacap combines deep sector expertise and strategic and operational excellence to partner with entrepreneurs and management teams. Since its inception, the firm has made primary and add-on investments in more than 250 companies. With over US $10 billion in assets under management and a presence across offices in Montreal, Toronto, and New York, Novacap accelerates value creation through strategic growth initiatives and a strong focus on execution.
For more information, please visit http://novacapcorp.com.
About 365 Data Centers
365 Data Centers is a leading provider of hybrid data center solutions to more than 1,200 customers from 17 network-centric data centers in strategic markets. The company also operates a resilient, low latency, nationwide fiber network and four cloud regions. 365’s secure, reliable, colocation, network connectivity, internet access, DRaaS, BaaS, cloud computing and storage, and business continuity services help organizations reduce costs, drive innovation, and improve their customer experience.
For more information, please visit https://365datacenters.com.
