Applied Digital Seeks $1.59 Billion Debt Raise for Fourth Ellendale AI Data Center

Applied Digital is turning again to the private debt market to finance its AI data center buildout, with a subsidiary seeking to raise $1.59 billion in senior secured notes for the fourth building at the company’s Ellendale, North Dakota, campus.

The Dallas-based company said Tuesday that APLD ComputeCo 3 LLC plans to offer the notes due 2031 in a private placement to qualified institutional buyers and non-U.S. investors. The proceeds are expected to fund construction and related expenses for 150 megawatts of critical IT load at ELN-04, the fourth building at Applied Digital’s Polaris Forge 1 AI Factory campus.

The planned financing would also be used to repay the principal balance and accrued interest under a bridge loan facility provided through a credit and guaranty agreement with Goldman Sachs Bank USA, fund debt service reserves and pay transaction expenses, the company said.

The new offering underscores how Applied Digital is relying on project-level debt to fund an aggressive expansion from bitcoin mining infrastructure into AI and high-performance computing data centers. If completed at the announced size, the latest deal would lift Applied Digital’s senior secured notes raised or proposed since November to about $6.09 billion.

Applied Digital priced a $2.35 billion offering of 9.25% senior secured notes due 2030 in November at 97% of par, with proceeds allocated to the 100 MW ELN-02 and 150 MW ELN-03 facilities at Polaris Forge 1, repayment of an SMBC loan and debt service reserves. In March, another subsidiary priced $2.15 billion of 6.75% senior secured notes due 2031 at 98% of par to fund the Polaris Forge 2 campus.

The latest proposed notes follow the same broad project-finance pattern. The debt will be guaranteed by APLD ComputeCo 3’s existing and future direct and indirect subsidiaries, including entities tied to ELN-04 and its land. The notes and guarantees will be secured by first-priority liens on substantially all assets of the issuer and guarantors, subject to exclusions, as well as the equity interests in APLD ComputeCo 3 held by its direct parent.

Applied Digital will also provide a completion guarantee for ELN-04, committing to fund the project company as needed to ensure the project is completed on time.

The proposed raise comes as Applied Digital is trying to scale its AI data center portfolio amid a wave of demand from hyperscalers and AI cloud operators for large blocks of power-backed capacity. On Monday, the company announced a 210 MW lease at its Delta Forge 2 campus with a U.S.-based investment-grade hyperscaler, saying the 15-year take-or-pay agreement represented about $5.2 billion in base-term contracted revenue.

That lease announcement added to investor focus on Applied Digital’s ability to turn power sites into contracted AI infrastructure. The company has sought to present its model as repeatable across campuses, using long-term leases to support project-level financing for large data center developments.