Site Selection, Power, Permitting and the Deal, End to End
Julian R. Sterling
These are the companion files of The Data Center Development Handbook by Julian R. Sterling.The book on Amazon →
These are the workbook and documents that go with the book. Chapter 13 works three business models on the
same 180 MW site, prints a figure for each, and closes with a levered return in the high teens — a
number it never builds. The original workbook builds it, on the chapter’s own figures. Around it: the
same model with the inputs emptied, four printable working documents from the appendices, a question book
that marks itself, and three cases the book names and never takes to a number.
Six workbooks, the printable documents and the read-me. Each group below can also be
downloaded on its own. Last revised 22 September 2026.
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The three models reconcile first. Turnkey at $11 million per MW is
$1,980 million; at $105 per kW-month, gross rent is $226.8 million, yield on cost
10.86 per cent, stabilised value $2,774 million, value created $794 million, spread
311 basis points. The chapter prints about 227, 10.9 per cent, 2.77 billion, 790 and 310.
Everything comes back. Nothing on this page is a disagreement about arithmetic.
The interest rate is taken out of the chapter, not out of the air. Chapter 13
says a twelve-month slip costs roughly $75 million of extra interest. At 60 per cent
loan-to-cost the drawn balance is $1,188 million, so that implies 6.3 per
cent. Used throughout, the delay case reproduces the chapter’s own figure rather
than replacing it: $74.8 million of interest and $94.8 million all-in against the
chapter’s “near $95 million”.
The levered return, and the assumption behind it. With no rent escalation the
answer is 18.6 per cent — high teens, as the chapter says. With a three
per cent escalator on the same lease it is 22.6. Four points of return sit
between a flat lease and a three per cent one, on identical dirt and identical capital. Both
are defensible; only one is stated.
The delay costs more than the rent miss, and here is the gap. On the
chapter’s own basis, an eight per cent rent miss costs 257 basis points
and a twelve-month energization slip costs 399. The chapter’s two claims
are both right, and now measured. The correlated case — delay, five per cent cost
overrun, rent miss and 25 basis points of exit cap — costs 809, and the capital call is
24.9 per cent of committed equity against 12.0 for the delay alone.
And one correction. Chapter 13 says an eight per cent rent miss reduces exit
value by roughly $215 million. Its own arithmetic gives $222 million — and in
giving it, shows what it assumes: that the shortfall never escalates. A first-year shortfall is
a shortfall in the rent that escalates. Priced at the exit under the chapter’s own three
per cent escalator, the loss is $273 million, twenty-three per cent
larger.
Two numbers the chapter asks for and does not give. One point of escalator is
worth 7.5 per cent of face rent over a fifteen-year lease — the exchange
rate behind the chapter’s claim that escalators beat first-year rent. And the powered-land
break-even hit rate is 25.8 per cent: a near-fourfold multiple on the winners
is a losing business below one site in four. Thirty-one checks.
Set the escalator on sheet 1 to zero. The levered return falls from 22.6 per cent to 18.6
— the chapter’s “high teens”. That is the assumption behind the
chapter’s headline number, and the chapter does not state it. Then set the hit rate on
sheet 6 to one in five and watch the powered-land business lose money at a 3.9 times multiple.
What the arithmetic does not settle
It cannot tell you your own hit rate on powered land — that number lives in your pipeline
history and nowhere else, and it is the one that decides whether the business is a business. It
cannot tell you whether your utility will hold its energization date; utilities do not generally
pay damages for missing one, which is why the chapter puts that risk in the “taken”
box and not the “shifted” one. And it cannot price a re-leasing problem: a slip that
trips a lease outside date stops being a return haircut and becomes a different project.
The same model, on your own campus
The underwrite with the same formulas and every input on sheet 1 emptied. Type your own site into it and the whole model re-solves.
Blank set · one workbook
Your site, your underwrite
Capacity, the two capital costs, the two rents and their net operating income, the exit caps,
the loan to cost and the hold, then the added terms the chapter never states: the development period,
the construction rate, the escalator, the cost of sale, the delay overheads and the draw profile, and the
powered-land inputs. The checks sheet counts the inputs still empty and runs the tests that hold on any
campus: turnkey costing more per MW than a shell, NOI below gross rent, a yield on cost above the exit cap,
a hold longer than the build.
Put the book’s inputs back, listed in the archive, and the book’s figures come back with
them: 10.9 per cent on cost, 22.6 per cent levered, 18.6 on flat rent, a 25.8 per cent break-even hit rate.
Six pages to print and take into a meeting. A4, with margins wide enough for US Letter.
Appendices A to D
Four working documents
The Appendix A site screening scorecard: the seven hard fails first, then sixteen weighted criteria
with a score, a confidence and the evidence. The Appendix B first utility conversation: the package to
assemble and the question groups to take in. The Appendix C diligence and document checklists, six groups
from title to the closing binder, each item with an owner, a date and the document that closes it. And
the Appendix D long-lead equipment tracker, from specification freeze to the float against the date the
equipment is needed.
A workbook that marks itself. Answer in the yellow cells; the marking fills in as you go.
All parts of the book
Twenty-nine numerical, eleven multiple choice
The numerical questions work the book’s own figures: the three business models of Chapter 13
and Appendix G, the levered return and its scenarios, the escalator and the powered-land hit rate, the
Chapter 8 demand charge against load factor, and the Appendix D lead times. They are marked against a
tolerance, so a reasonable rounding passes. The score sheet counts the wrong answers by part of the
book.
Nothing is hidden. The marking sheet holds every answer, every tolerance, and the reason for
each answer.
New material, not a restatement. Three situations the chapters name in passing and never take to
a number. Each case is one workbook: the note is the first sheet, the model is the rest, and a
checks sheet closes it. Type your own figures in and every finding recomputes.
Case one · extends the ratchet in Chapters 5 and 8
The test that sets the bill
A full-load commissioning test at 180 MW on a campus that draws 30 and ramps by 15 a month. The 80 per cent ratchet fixes billing demand at 144 MW for seven months and costs 4.54 million dollars of demand charges on capacity nobody used. Testing at 60 MW would have cost 36,000.
Case two · extends bridge power in Chapter 7
Bridge or wait
The chapter’s gap: 60 MW wanted in month 18, the grid in month 48. On illustrative costs, bridging with engines is worth about 28 million dollars; if the gas arrives nine months late it loses 4.7 million. Bridge power can rise to about 117 dollars a MWh before the answer changes: the margin on price is wide, the margin on time is not.
Case three · extends the minimum take in Chapter 5
Fifteen years of lease, twenty of minimum take
The five years of naked exposure the chapter names, valued: 85.8 million dollars at lease expiry if nobody takes the space, 8.2 million expected at signing, 27.0 million in the worst case. A termination payment fixed at signing halves the bad case; a minimum take matched to the lease removes it.
an input the book does not state — ten of them, each labelled with the reason
Checks sheet
thirty-one controls — five test the file against the book, and two sit side by side on the one figure it corrects
Every figure is illustrative, as the campus in Chapter 13 is. The site, the tenant and the
lender are the book’s own invented case; the development period, the interest rate, the draw
profile and the escalator are added because the book does not state them, and each is an editable
cell.
Opening the file
The workbook opens in Microsoft Excel, LibreOffice Calc, Google Sheets and Numbers. It uses no
macros and no add-ins, so nothing needs to be enabled or trusted. If your spreadsheet asks to
update links on opening, decline — there are none.
What changed, and when
22 Sep 2026
Blank model set, four printable working documents, the question book and three new cases added. The workbook can now be downloaded on its own. Read-me rewritten.
How much does a data centre cost to build per MW?Divide the all-in cost by critical IT load, not utility capacity. An illustrative 60 MW campus costs $670.2m: $11.17m per IT MW, but only $8.59m per utility MW.
How much revenue does a data centre make per MW?Rent per MW-year = $ per kW-month x 1,000 x 12. At $105 one leased MW earns $1,260,000 of rent and $1,194,444 of NOI; pass-through power adds $558,012.
How much land does a data centre need per MW?Build it up from the building, the yards and the setbacks. An illustrative 100 MW single-storey campus at 150 W per sq ft needs 68.1 acres: 0.68 acres per MW.
Closing the DealTwo defensible bridges 20.70 million apart, a peg worth 7.00 million, and the six choices that remove 6.60 of a 12.00 earn-out.
CMBS and CRE CLOsWhere the loss actually lands, from appraisal reduction to realised severity, and what the B-piece is really being paid for.
How to Read a Commercial LeaseThe three refinements chapter 19 names and never performs, and the renewal rate below which the mark-to-market is worth nothing.
How to Read a Credit AgreementWhere the default actually comes from, the cure that costs 5.5 times the other, and the capacity nobody adds up.
How to Read a Real Estate Loan AgreementThe cure ratio in closed form, the four-point window in which the cheap cure works, and the cure sized to the wrong threshold.
Office Real EstateA six per cent yield that returns 3.2 per cent once the re-letting cycle is paid for, and the headline-to-net-effective rent arithmetic.
Private Equity Real EstateBoth worked waterfalls to the dollar, the two capital stacks, and the arithmetic of the promote made changeable.
Private Markets PerformanceThirty-one of the thirty-three figures chapter 19 publishes reproduce exactly — and the two that do not are named rather than quietly adopted.
Raising a Real Estate FundThe chapter 17 funnel run on a calendar — when the first close actually lands, and why more travel does not help.
Real Estate FinanceFour people look at one building and reach four numbers; the lender is whole only above 105,109,489, twelve per cent below today’s value rather than forty.
Real Estate Financial ModelingProperty, development and fund models built line by line, and the modelling test worked end to end.
Real Estate Fund ManagementThe waterfall of 6.11, the build-to-core of 8.7 and the proceeds gap, reproduced as live formulas rather than asserted.
REIT Analysis and ValuationFFO of 532.0, AFFO of 381.0, net asset value and dividend safety — every figure a formula you can change.
Retail Real EstateThe occupancy cost of every unit in a centre, the sixteen per cent of the rent roll no tenant can sustain, and the right-size-convert-or-hold decision priced.
Sale and LeasebackA €179.5 million transaction end to end, with rent cover measured on the entity that actually signs the lease.
Self-Storage Real EstateThe cohort engine behind a 590-unit store, and the rate increase on existing customers priced against the move-outs it causes.
The Fund Finance ProfessionalChapter 8 builds the reported-to-eligible NAV bridge; chapter 9 computes every ratio without it. Two points at every state — and what a subscription line does to the IRR.
The Growth Equity InvestorWhat a pro rata cheque really costs, and the band where defending your ownership loses money.
The Private Credit InvestorThe two coverage ratios are not measured on the same thing: the erosion is 47.7 per cent, not the 28.7 the headline implies.
The Private Equity Fund Controller PlaybookThe book defines IRR, DPI, RVPI and TVPI, tells you to update them at the exit, and prints not one value. Computed: a 1.833× deal inside a fund at 0.892 TVPI.
The Venture Capital AssociateWhat defending a position costs, and how many companies a reserve pool actually defends.
Financial Risk ManagementA fund inside every limit that cannot meet a redemption — and the number that decides it is the one with no currency attached.
Business ValuationThree advisers land 26.8 per cent apart on one company, and the whole gap turns out to be 1.96 points of perpetual growth.
Quantitative FinanceThree models agree to a quarter of one per cent about a number that one unobservable input moves a hundred and three times as much.
Asset ManagementFour people quote four returns for one mandate, all correct and 2.7017 points apart — forty-eight times the manager’s net skill.
Alternative InvestmentsA manager reports 13.29 per cent and the endowment earns 6.26 — both correct, and only a third of the advertised advantage arrives.
Credit AnalysisFour defensible EBITDAs on one borrower give leverage from 3.19x to 6.47x — and the add-back argument is fifty times the covenant headroom.
Venture CapitalOne company out of twenty-eight returns 56.7 per cent of the fund, and half the capital goes in after the decision — at half the return.
Machine Learning for FinanceFive people quote the accuracy of one credit model, all five are right, and the number that decides how much money it makes is none of them.
Commercial Real Estate InvestingThe equity earned 8.6647 per cent and the investor received exactly 8.0000 — the preferred return, and nothing above it.
Mergers and AcquisitionsThe board paper says the deal creates 13,436,667 of value. The arithmetic says it destroys 17,530,855. Nobody is lying.
DerivativesThe treasury report says the hedge cost 1,233,698. That is the interest differential, not a cost.
Treasury ManagementFive cash balances for one company, all correct and 145,600,000 apart — and the revolver that is two-thirds of the liquidity leaves at a revenue fall of 8.4127 per cent.
Financial Planning and AnalysisRevenue 3.0190 per cent above budget and operating profit 16.3209 per cent below it, in the same quarter, with every figure correctly stated.
Energy TradingA position report that is 91.7031 per cent hedged and correctly computed, on a book that is short 2,542,000 MWh — and a margin call of 198,400,000 the next morning.
Construction Cost ControlA contract sum of 26,301,102 became a final account of 29,153,363 on the building that was drawn — and 85.8 per cent of what was lost was knowable on the day it was signed.
Trade FinanceSix routes to payment on one 4,200,000 export order cost between 178,040 and 223,268, a spread worth 14.8 per cent of the margin, and a day of buyer credit costs 1,031.76.
Cost AccountingOne factory costed twice on the same 13,440,000 of overhead, and 4,053,091 moves between four product families.
Pricing StrategyA list price of 148.00, a pocket price of 112.51, and the nine deductions in between — with what one point of price is actually worth.
Contract ManagementA bid 5.50 a unit cheaper, signed on paper worth 9.81 a unit more — and 94.68 per cent of it was knowable on the day of signature.
Capital MarketsFour defensible readings of one bond, the cost of an issue under each convention, and the placement discount computed at a constant discount.
Financial RegulationThree ratios pass and the fourth is in breach by 1,956.0 million: the output floor, the liquidity buffer after encumbrance, and the loan split.
Bank ManagementFour defensible readings of one balance sheet, the deposit beta measured two ways, and the liquidity that lasts 3.9 days.
The Real Estate WorkoutFour ways out of one broken loan, discounted to today, and the 58.7 cents at which a payoff beats enforcement.
The Data Center Development Handbook develops the complete framework behind these models, with the assumptions, trade-offs and worked examples tied together.
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After the keys are handed over
The Data Center Operations Handbook picks up where this book stops: a 36 MW campus run for three years, its contracts, its power bill, its incidents and service credits, and the liquid-cooling retrofit. Its companion workbook is free.