Lenders are tightening terms on AI data center debt, favoring projects backed by major cloud providers over speculative builds. AI-related debt issuance has jumped twentyfold as a share of high-grade US corporate bonds since 2024, while Oracle filed a force majeure notice on its New Mexico project and its stock came under pressure.
The AI data center boom has run on borrowed money, and lenders are now getting picky about who they fund. Investors are pulling support from riskier data center projects and shifting toward bets backed by major cloud providers, tightening credit conditions across the sector. Developers without blue-chip tenants are finding the terms harder to come by.
The debt pile keeps growing
AI-related debt issuance reached nearly $500 billion by August 2026, accounting for about 20% of higher-rated US corporate bond issuance. In 2024, that share stood at just 1% — a twentyfold jump in roughly two years. Morgan Stanley anticipates approximately $3 trillion in AI infrastructure spending through 2028, with half of it financed through debt. JPMorgan goes further, estimating $4.1 trillion in AI-related debt by 2030.
Yields widen even for blue-chip names
A Meta-backed data center project in El Paso priced with a yield of 7.53% in July 2026. An earlier deal involving Meta and Blue Owl carried a yield of 6.58% — nearly a full percentage point lower despite the same type of project and the same blue-chip name attached.
Further down the risk ladder, the numbers climb faster. BB-minus bonds linked to CoreWeave carried yields around 10%. CoreWeave has spelled out what floating-rate exposure means for its business: as of June 2026, a 100-basis-point rise in rates could add approximately $30 million in quarterly interest expenses on its floating-rate debt.
Oracle hits a permitting wall
In September 2026, Oracle filed a force majeure notice for its New Mexico data center, known as Project Jupiter, citing power and permitting issues. Oracle's stock came under pressure, and the company ran into complications securing syndicated loans.
The key things to watch from here are yields on new data center deals, the width of credit spreads, and whether more projects hit power or permitting walls. If Morgan Stanley's and JPMorgan's projections hold, the debt market will be asked to fund a great deal more of this build-out, and the terms it sets will shape which projects actually get built.
Source: Crypto Briefing
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