Meta's borrowing costs just went up 0.4 points from nine months ago and nobody's talking about why the collateral is a lease, not the building

Dug into the structure behind Meta's new $14B data center deal with BlackRock since the headline number alone didn't say much. BlackRock funds own 80% of the El Paso project, Meta owns 20%. Meta puts in $2.3B in land and existing construction, BlackRock puts in $4.9B cash and finances $12.5B more through bonds due 2048. The collateral is what stood out. Not the data center itself, a 20-year rent agreement that doesn't start until 2028, once the building's actually finished. Until then bondholders are holding paper backed by a future lease, not a physical asset. Pricing shows the market noticed. These bonds came in above 7%, about 0.4 points higher than Meta's own $27B Hyperion sale in October, the largest corporate bond deal on record at the time. Demand landed at 1.6x the offering versus a roughly 4x average this year. Same A+ rating from S&P, higher yield required anyway. Not just a Meta thing. Combined AI infrastructure bond issuance from Meta, Alphabet, Amazon, Microsoft, and Oracle went from $40B in 2020 to $121B in 2025. SPV structure keeps it off the balance sheet, doesn't make the rent obligation less real.