COPT Defense Properties: Mission-Critical Data Centres

COPT Defense Properties has secured the number 17 position in Data Centre Magazine's Top 100 Data Centre Companies 2025, reflecting its role in providing infrastructure that supports United States national security operations. 

The company has built its business around a premise that sets it apart in the data centre industry: proximity to United States defence installations matters. The Columbia, Maryland-based real estate investment trust operates 193 properties totalling 22M square feet, with more than 90% of rental revenue derived from Defense/IT locations near key military and intelligence facilities.

Its data centre portfolio spans 6.3M square feet designed to meet government security standards. These facilities serve agencies involved in intelligence, surveillance, cybersecurity, space operations and cloud computing that support national defence priorities. The US Government generates 36% of COPT Defense's annualised rental revenue, with defence contractors contributing 51%.

Stephen E. Budorick, president and CEO of COPT Defense Properties, said: "COPT Defense's business model focuses on owning properties and developable land near key United States defence installations whose missions have been and continue to be Department of Defense spending priorities such as Intelligence, Surveillance and Reconnaissance, Missile Defense, R&D, Space, Cybersecurity and Cloud Computing.”

Security infrastructure and clearances

The company maintains TS/SCI credentialed personnel across its operations, enabling it to design, construct and operate facilities that meet Intelligence Community Directive standards and Department of Defense Anti-Terrorism/Force Protection requirements. The security infrastructure allows COPT Defense to serve clients that require classified data handling capabilities.

The Defense/IT Portfolio maintains a 96.7% lease rate. The company expects to deliver funds from operations per share growth of approximately 6% in 2024, outpacing the office REIT sector where most operators are experiencing declines. For 2025, COPT Defense has guided to nearly 4% FFO per share growth at the midpoint, marking seven consecutive years of growth.

Expansion beyond traditional markets

In September 2024, COPT Defense acquired a 365-acre site near Des Moines, Iowa for US$32m. The parcel can accommodate approximately 3.3M square feet of development supported by an estimated 1 gigawatt of power capacity. This acquisition represents the company's first expansion outside its traditional Northern Virginia and Mid-Atlantic strongholds.

"Our land acquisition outside of Des Moines, Iowa provides a significant opportunity for us to expand our highly successful data centre shell program to a new market," Stephen stated following the acquisition.

The company's development strategy centres on providing custom shell solutions with robust power provisioning, achieving completion timelines of 12 to 15 months from land acquisition. This approach targets both government clients and hyperscale operators seeking secure, high-capacity facilities.

Former US President Joe Biden's January 2025 executive order directed the Defense and Energy departments to identify federal sites for gigawatt-scale AI data centres. This initiative aligns with COPT Defense's focus on developing infrastructure adjacent to government installations.

Defence budget dynamics

Defence spending patterns directly influence COPT Defense's growth trajectory. At the Bank of America Global Real Estate Conference in September 2025.

Stephen said: "We have strong underlying tailwinds from the growth in the defence budget, the funding for the Golden Dome, Defense Shield for the United States and the recently announced relocation of US Space Command headquarters from Colorado Springs to Huntsville.

"I might add, it will go on the land that we control and we will develop the properties."

The One Big Beautiful Bill pre-appropriated US$150bn over five years, including US$113bn in fiscal year 2026. COPT Defense expects the funding to generate leasing and development opportunities within 12 to 18 months as contracts are awarded and space requirements materialise.

The company has increased its dividend nearly 11% over the past three years and remains the only office REIT to raise distributions in both 2023 and 2024. With a US$600m revolving credit facility backing its development pipeline, COPT Defense continues to expand its portfolio at the intersection of real estate and national security infrastructure.

COPT Defense Properties' number 17 ranking in Data Centre Magazine's Top 100 Data Centre Companies 2025 recognises its position within the sector's infrastructure providers. The annual ranking evaluates companies across the data centre ecosystem based on their contribution to the industry's development and growth.