Urbacon Achieves a Series of Firsts with $320M Data Centre ABS Refinancing Deal

In fall 2025, Urbacon Data Centre Solutions achieved a series of firsts as it closed on a $320-million issuance of asset-backed securities with strong support from Canadian and U.S. investors and institutions for an expansion project in the company’s Barker Business Park in Toronto.

Urbacon earned the first-ever Canadian hyperscale data centre asset-backed securities (ABS) issuances, establishing the Toronto-based company as a pioneer in bringing this financing model to Canada. The model had been used in the U.S., but never in Canada previously.

Urbacon also became the first Canadian company to receive an ABS data-centre rating from Fitch, achieving a single-A mark, and earned the lowest ABS pricing yield since 2021. The transaction attracted exceptional demand. At Initial Price Thoughts (IPT), the order book was approximately 8x oversubscribed, reflecting exceptional institutional demand. This situation allowed the notes to price at a spread of 155 basis points over the benchmark, resulting in a fixed coupon of 4.511%.

An ABS master-trust structure was used for a Canadian hyperscale ABS data-centre deal for the first time, although such use is common in the U.S. data centre development sector. The structure created a scalable financing vehicle for Urbacon’s approximately $2-billion development pipeline, enabling future note issuances as new data centres stabilize.

The ABS master trust structure stood out for its non-recourse terms, highest proceeds, lowest cost of capital, and built-in flexibility for future issuances.

These are considerable accomplishments given that Urbacon had no prior securitization track record, requiring the company to build credibility with ratings agencies and investors from scratch while navigating an unfamiliar and highly complex financing structure. As a Canadian-domiciled data centre ABS issuer, Urbacon was competing in an investment category almost entirely dominated by U.S.-based issuers. As a result, Urbacon’s financing team of President Anas Youssef, Associate General Counsel Tatiana Zalar and Real Estate and Finance Investments Director Michael Feldstein needed to educate investors on the Canadian market, regulatory environment, and asset quality. Adding a difficult workstream, the team of Youssef, Zalar and Feldstein obtained a Sustainalytics second-party opinion (SPO) as it completed the ABS process, qualifying the notes as green bonds and subsequently aligning with institutional investors’ ESG mandates and broadening the investor base.

As a result, Urbacon validated Canadian data-centre infrastructure as an institutional-grade asset class. The offering attracted a broad and diverse pool of U.S. and Canadian institutional investors as about 80 accounts viewed the company’s investor roadshow, demonstrating that Canadian data-centre assets can compete for capital on the global ABS stage.

These are some of the reasons why the Urbacon team of Anas Youssef, Tatiana Zalar and Michael Feldstein received a Connect Canadian Transactions of the Year Award for completing the $320-million deal. The awards highlight deals and closings impacting Canada’s commercial real estate sector.