The $80 Billion Rent Check: Why Microsoft and Amazon are Making Data Center REITs Rich

Here's a question nobody's asking: Why are the richest companies on Earth paying rent?

Microsoft $MSFT ( ▼ 3.36% )  has $78 billion in cash. Amazon $AMZN ( ▼ 3.63% )  has $87 billion. Google $GOOG ( ▼ 3.9% )  could buy a small country. Yet all three are writing massive checks to landlords every single month.

The landlords? Data center REITs.

And if you're still debating data center REITs vs individual tech stocks for AI exposure, this article might change your mind.

📈 The Landlord Strategy

The AI boom has a dirty secret. Building data centers is slow, expensive, and capital-intensive. Even for Big Tech.

A single hyperscale data center costs $1-2 billion to build. It takes 2-3 years to get operational. And by the time it's finished, the AI landscape might look completely different.

So what do Microsoft, Amazon, and Google do instead?

They rent.

Not because they can't afford to build, but because leasing from REITs lets them scale faster while conserving capital for what they actually care about: AI models, cloud services, and market dominance.

This is why data center REITs saw 21% year-over-year growth in funds from operations (FFO) in early 2025. The hyperscalers need capacity now, and they're willing to pay premium prices for it.

💰 Follow the Capex

The numbers tell the story.

Big tech AI capex spending in 2026 is projected to exceed $300 billion combined across Microsoft, Amazon, Google, and Meta. A significant chunk of that isn't going into their own pockets: it's flowing directly into REIT revenue.

Digital Realty $DLR ( ▼ 1.94% )  reported a record booking quarter in late 2024, exceeding $500 million in new leasing revenue. Here's the kicker: 50% of that was attributable to AI workloads alone.

That single AI-driven quarter would have been a historical record for the company even without the non-AI business.

This isn't a temporary spike. It's a structural shift.

The demand is so robust that Principal Financial raised $3.6 billion specifically for a Data Center Growth & Income fund in early 2025: targeting hyperscaler facilities. BlackRock $BLK ( ▼ 1.33% ), Microsoft, and Nvidia $NVDA ( ▼ 0.64% )  are partnering on a $30 billion infrastructure fund for data center construction. When the smart money moves this aggressively, I pay attention.

🔍 Data Center REITs vs Individual Tech Stocks

Let me be direct: most investors are playing the AI trade wrong.

They buy Nvidia. Maybe Microsoft. Perhaps a speculative play on some AI software company.

But they're ignoring the best high-yield AI infrastructure plays sitting right in front of them.

Here's how I think about it:

Tech stocks give you direct AI exposure: but everyone knows that. The multiple expansion has already happened. You're buying the narrative at a premium.

REITs give you indirect exposure with less competition. You're essentially collecting rent from the AI boom without betting on which model or which chip wins.

The hyperscalers have to lease capacity. They don't have a choice. That's a more durable thesis than hoping Nvidia's next chip cycle exceeds expectations.

If you haven't read our breakdown of the full infrastructure opportunity, check out The 2026 AI Infrastructure Playbook.

🏢 The Three REITs I'm Watching

Not all data center REITs are created equal. Here are the three that stand out as potential big tech AI capex spending 2026 winners.

Equinix $EQIX ( ▲ 0.49% )  

The blue chip of the space. Equinix operates 260+ data centers across 70+ metros globally. Their interconnection model: where they charge companies to connect to each other within their facilities: creates sticky, recurring revenue.

Why it matters: Microsoft, Amazon, and Google all lease from Equinix. When hyperscalers need global reach fast, they call Equinix first.

The risk: Premium valuation. You're paying for quality here.

Digital Realty $DLR ( ▼ 1.94% )  

The pure-play AI beneficiary. Digital Realty has aggressively positioned itself for the AI workload surge, and the booking numbers prove it's working.

Why it matters: That 50% AI attribution in their record quarter isn't an accident. They've structured their facilities specifically for high-density AI compute.

The risk: Execution. They're investing heavily in capacity expansion, which means capital allocation matters.

American Tower $AMT ( ▼ 2.42% )  

The wildcard. American Tower is primarily known for cell towers, but they've been quietly building out their data center footprint through the CoreSite acquisition.

Why it matters: Diversification. You get telecom infrastructure + data center exposure in one ticker. If AI edge computing becomes a thing, AMT is positioned.

The risk: Less pure-play than EQIX or DLR. The thesis is more complex.

⚠️ The Risks Worth Monitoring

I'm not here to pump REITs blindly. There are legitimate concerns.

Interest rate sensitivity. REITs are rate-sensitive assets. If the Fed stays higher for longer, multiples compress. This is the primary bear case for the entire sector.

Supply concerns. There's a lot of data center construction happening. If supply outpaces demand, pricing power erodes. I'm watching absorption rates closely.

Hyperscaler leverage. Microsoft and Amazon have negotiating power. If they push for better lease terms, margins could compress.

That said, the demand tailwinds are strong enough that I think these risks are manageable: not disqualifying.

📊 The Bottom Line

The AI trade isn't just about chips and software.

It's about the physical infrastructure that makes AI possible. The buildings. The power. The cooling systems. The landlords collecting rent from the richest companies on Earth.

When you compare data center REITs vs individual tech stocks, the REITs offer something rare: AI exposure with yield, moderate volatility, and a thesis that doesn't depend on one company winning the AI race.

Microsoft, Amazon, and Google all win? REITs win.

Only one of them wins? REITs still win.

That's the kind of asymmetry I look for.

☕ What's Next

This article is part of our Picks and Shovels series: exploring the infrastructure layer of the AI boom that most investors overlook.

If you want the complete picture, start with The 2026 AI Infrastructure Playbook. It's our hub for everything infrastructure: power suppliers, cooling companies, and yes: the landlords.

The AI boom is just getting started. Make sure you're positioned for it.

George ☕️