Overfinancing & Bubble Probability Assessment
Is the datacenter boom overfinanced, and where is the risk concentrated?
Chapter summary
The chapter weighs supply pipelines, absorption, debt issuance and leverage against the telecom bubble of 2000 and the 2001–2003 datacenter oversupply, then assigns probabilities to three scenarios.
Key takeaways
- 1
Base case (50%): a soft landing with selective distress in overbuilt markets.
- 2
Downside (30%): oversupply crystallises in 2026–2027; upside (20%): AI demand outruns supply.
- 3
Industry LTVs are currently 50–70%; the study recommends a 50–60% maximum.
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