Companies like Hut 8, Core Scientific (CORZ), Hive Digital (HIVE), and Bit Digital (BTBT) are redeploying some of their power and infrastructure assets to support AI workloads, betting that long-term contracts with hyperscale customers will generate more stable and higher-margin revenue than crypto mining alone.
Hut 8 has signed two 15-year, triple-net, take-or-pay leases covering 597 megawatts of IT capacity at its Riverbend, Louisiana, and Beacon Point, Texas, campuses. The deal has a base lease value of $16.8 billion, which could increase to $42.8 billion if tenants exercise renewal options, Palmer said.
Mr Palmer said the Beacon Points deal was a major factor in the valuation increase. The brokerage estimates that the first phase of the project alone will have a base contract value of $9.8 billion and average annual net operating income of approximately $655 million.
He also addressed Hut8’s financing strategy, noting that the company recently closed $4.25 billion in investment-grade project financing for Beacon Point after raising $3.25 billion for Riverbend. This transaction validates management’s strategy to reduce cost of capital by converting development assets into long-term contracted cash flows.
In addition to existing projects, the report highlights Hut 8’s development pipeline, totaling more than 9 GW across proprietary, development, construction and management projects, providing what it calls a long runway for future growth.
