Colocation Data Center

The Denver Data Center is a 100% NNN-leased, purpose-built powered shell facility 8 miles from Denver International Airport. The 150,000-square-foot property is fully occupied by an institutionally backed colocation operator that has continuously occupied the site since 2008 as part of a 16-facility national platform. Leveraging its tenant relationship, Aphorio Carter created significant value pre-closing: originally under contract at a 6.0% cap rate on the in-place 5-year lease, the deal closed with a new 15-year lease at an 8.5% cap rate on the existing 4.3 MW of IT capacity, a meaningful improvement in both term and yield, achieved entirely before closing with no investor capital at risk. The tenant intends to expand to 12.3 MW of IT capacity, with Aphorio Carter funding the $80 million buildout at a fixed 10.2% yield on cost in exchange for a lease extension.

RISK FACTORS

An investment in Aphorio Carter Critical Infrastructure Fund, LLC (the “Fund”) is subject to various risks which could cause the value of our units to decline and could cause you to lose all or part of your investment. Those risks include, but are not limited to, the following:

  • There is no public market for the units and such units will not be registered with the Securities and Exchange Commission or the securities commissions of any state or country;
  • The Fund is a newly formed business entity with a limited history of operations and limited assets. The Fund is subject to the risks involved with any speculative new venture. No assurance can be given that the Fund will be profitable;
  • The Fund may suffer delays in identifying suitable investment opportunities;
  • Our ability to raise sufficient capital in this offering;
  • The units are not liquid investments;
  • Our manager’s duties to unitholders is limited;
  • Unitholders having limited voting rights with respect to the management or operations of the Fund or in connection with investment decisions;
  • Our manager has the ability to change our targeted investments and investment objectives without unitholder consent;
  • The Manager and its affiliates are engaged in other activities and intend to continue to engage in such activities in the future, including other real estate ventures. The Manager and its affiliates and their principals will therefore have conflicts of interest in allocating management time, services and functions between various existing enterprises and future enterprises the Manager and its affiliates and their principals may organize, as well as other business ventures in which the Manager, its affiliates and their principals may be or may become involved
  • The total amount of Offering Proceeds and the number of Investments acquired by the Fund is uncertain. It is possible that the Fund will only purchase a few Investments, limiting the diversification of the Investments of the Fund and increasing the risk of loss to investors.
  • Various risks inherent in real estate investing including, without limitation, natural disasters such as hurricanes and floods, changes in national and local economic conditions, changes in the investment climate for real estate investments, changes in the demand for, or supply of, competing properties, changes in the local market conditions and neighborhood characteristics, the availability and cost of mortgage funds, the obligation to meet fixed and maturing obligations, changes in real estate tax rates and operating expenses, changes in governmental rules and fiscal policies, changes in zoning and other land use regulations, environmental controls, changes or fluctuations in supply of services, and changes in regulatory and environmental laws relating to technology related assets, among other factors;
  • Restrictions and risks associated with applicable encroachments, covenants, conditions, restrictions, rights of way, and easements that affect or could impact our investments;
  • The cost of compliance with all laws, rules, and regulations applicable to the Fund and its underlying investments;
  • Risks associated with tax considerations, including federal and state tax liabilities and obligations, unrelated business income tax applicable to tax-exempt unitholders, and ability of the Fund’s subsidiaries to qualify as real estate investment trusts for tax purposes;
  • The possibility of environmental risks relating to the properties, including changes in laws that affect the generation and consumption of energy usage generally or that affect data centers and other technology related assets specifically, which may be in the form of greater regulatory oversight based upon climate change measures, taxes or assessments on energy consumption and generation, among others;
  • Risks associated with the terms on which our properties are acquired, including the use of leverage;
  • Risks relating to the terms of financing obtained in connection with the acquisition of the properties;
  • Customary restrictions, covenants, representations and warranties, and obligations contained in loan documents in connection with the financing of the properties, and the risks associated with the events of default thereunder, including foreclosure of the properties;
  • Disruptions in the capital markets and fluctuations in economic conditions could adversely impact the Fund;
  • Joint ventures and other equity investments could increase our risk profile; and
  • Our unitholders may not realize a return on their investment for years, if at all.