Blackstone Sells 80% Stakes in Two Manassas and 50% in Sterling Data Centers to Digital Realty for $3.5 Billion

Blackstone divested the assets acquired through its 2023 joint venture and 2021 QTS purchase. The transaction increases Digital Realty's ownership in fully leased hyperscale facilities in the Data Center Alley corridor. Remaining Blackstone-Digital Realty holdings in Northern Virginia continue under the original partnership terms. Official statements cite portfolio optimization without referencing external pressures.

Local opposition has intensified against new builds, including Digital Gateway's 2,100-acre proposal and adjacent QTS parcels. Compass Datacenters withdrew from a Brookfield-backed project after sustained resident challenges. A Gallup survey documented 70 percent national opposition to local AI data centers, with resource consumption and utility costs cited by half of respondents. These documented frictions alter permitting timelines and raise capital costs beyond isolated project risks.

States and localities balance tax revenue gains against infrastructure burdens on power grids and water systems. Blackstone's partial exit demonstrates an incentive to crystallize returns before regulatory or political constraints tighten further. Primary records show no change in stated AI demand forecasts, yet the move aligns with selective de-risking observed in other commercial real estate segments.

Additional Virginia counties are expected to revise zoning rules and interconnection queues by mid-2025. Sustained opposition could extend approval timelines by 18-24 months for new facilities, forcing developers to internalize higher carrying costs or shift capacity to less contested jurisdictions.