Barry Sternlicht wants an even bigger piece of the expanding data center pie. 

Sternlicht’s Starwood Capital Group announced Wednesday that it closed a $10.2 billion opportunistic real estate fund to invest in residential, industrial, hospitality and data center real estate. The fund will target mainly deals in the U.S. and Europe, but will also look into Asia. 

Bloomberg first reported the news of the closing. 

Starwood envisions the fund — known as Starwood Distressed Opportunity Fund XIII —  will double its previous commitment to data centers and deploy a full 35 percent of the opportunistic capital toward an asset class that now powers the AI revolution, according to Sternlicht, the firm’s chairman and founder. 

“We are excited about the opportunities we have already sourced for this fund and are proud of our track record of delivering results for our investors through market cycles,” said Sternlicht in a statement.  

Starwood’s strategy, at least on the data center front, will focus on co-investment deals with larger players to bridge the huge capital needs most data center development require, which can reach as much as $2 billion for stand-alone assets. Other approaches will see the firm inject equity or debt into developments on a scattershot basis. 

Jonathan Pollack, president of Starwood Capital, said in a statement that his firm has seen investment tailwinds due to a lack of supply across traditional asset classes such as multifamily, hospitality and industrial, as well as “a tremendous growth” in technological and industrial assets. 

“This is an exciting time to be investing in real estate,” he added.

Starwood Distressed Opportunity Fund XIII has already closed 20 transactions totaling $3 billion of equity. The firm has teamed up with MARA Holdings, a vertically integrated digital energy and infrastructure company, to convert former bitcoin mining sites into new data center developments. 

Starwood Capital Group has roughly $130 billion of assets under management. 

Brian Pascus can be reached at bpascus@commercialobserver.com.