Nvidia will backstop $105 billion of OpenAI's new Ohio lease
A 20-year lease in Pike County, up to 8 gigawatts of compute, and a chip vendor underwriting its biggest customer's landlord.
A 20-year lease, 8 gigawatts, and the chip vendor guaranteeing the rent. AI compute financing got circular.
OpenAI announced a 20-year lease on a data center campus in Pike County, Ohio on August 17, and the structure is the story: Nvidia will backstop up to $105 billion of the obligations if OpenAI cannot pay.
The deal, piece by piece
- SB Energy, the SoftBank-owned developer, builds, owns, and operates the campus.
- OpenAI leases up to roughly 8 gigawatts of capacity over 20 years, with the first 800 megawatts targeted for 2028.
- Nvidia guarantees the lease: if OpenAI defaults, Nvidia covers the gap between the guaranteed minimum and whatever the owner recovers by re-leasing or selling the site.
- Nvidia also puts $1.5 billion of equity into SB Energy itself.
Bloomberg and Axios have the deal detail, and Jensen Huang says the site could eventually contribute as much as $200 billion to Nvidia's revenue. That framing explains the guarantee: Nvidia is not lending OpenAI money. It is insuring the building that will be filled with Nvidia chips.
Why the circle keeps tightening
Nvidia now has guarantee structures on both ends of the market: a financing guarantee program for chip buyers announced earlier this quarter, and a lease backstop for its largest customer's landlord. Each guarantee makes the next data center financeable, and each financed data center becomes future chip demand. It works as long as end demand keeps growing into it.
The honest caveat: the capacity does not exist yet. First power is targeted for 2028, the grid connection still has to be built, and a $105 billion guarantee is a contingent liability, not cash anyone has spent.
Why a build studio cares
Every campus like this eventually shows up in the price and availability of the APIs we build on. Compute that gets financed and built keeps token prices falling. Compute that stalls shows up as rate limits and price floors. The 800 megawatt target for 2028 is worth writing down: it is a checkable prediction in a market that mostly trades on vibes.
Next step: if your product depends on one model provider, write down what a 2x API price change does to your unit economics. The buildout is priced for demand that keeps compounding. Your margin should not be. If you want that math checked against your own product, write to us at hello@gattyworks.com.