My private lender passed on a 6 MW deal last month because the interconnection study was 38 months out and the developer called that "substantially de-risked.

Your read on the timeline math is the right place to be skeptical. If interconnection confirmation is month 38 and distributions start month 19, the assumption doing the work is that the facility generates leasable revenue before grid power is confirmed. That only closes if there is a bridge power source, a generator arrangement, temporary utility feed, or a phased occupancy structure where partial power is live well before full interconnection. The developer should be able to hand you a page that names that source and the contracted cost of it. If that page does not exist, month 19 is a projection built on an assumption that was never stress-tested.

"Substantially de-risked" is a presentation layer, not a risk mitigation structure. An interconnection study that returns a 38-month timeline tells you where you are in the queue and what the grid operator's current assessment is. It does not de-risk anything. It quantifies the exposure. The risk that remains is queue position movement, cost changes from the study outcome, and developer capital requirements if the timeline extends. A 38-month interconnection queue in a constrained power market can slip. It has slipped in Northern Virginia, in Texas, in the Sun Belt corridors where development is moving specifically because of power availability. Your lender made a rational call.

The thing I would push you on for next time: was there a co-location arrangement in the deal structure, where a hyperscaler or anchor tenant had already committed and was absorbing some of the power queue risk? That changes the profile considerably, because a signed hyperscaler lease with a creditworthy counterparty shifts negotiating weight back toward the developer in ways that a speculative facility does not have.

What was the equity structure on the fund, and did the developer provide any documentation on the interim power arrangement or just reference it verbally?

Your math is right, and I want to explain the mechanism so you can see exactly where the gap lives.

"Interconnection study" refers to the process a utility runs to figure out whether the local grid can actually deliver power to a new facility, and if not, what upgrades are required and who pays for them. That study has to complete before power delivery is confirmed. Thirty-eight months out means the utility has not yet said yes, how much, or at what cost.

"Substantially de-risked" is doing a lot of work there. A study underway is meaningfully different from a study complete. The study completing is also different from power actually flowing. A developer can clear the study and still face years of physical infrastructure work before a megawatt arrives on site.

The month-19 distribution projection is the part I would want a very specific answer to. Distributions to passive investors typically come from revenue, and a data center does not generate revenue until tenants are operating, which requires power. If power is not confirmed until month 38 at the earliest, a month-19 distribution either assumes power arrives early, or it comes from a different source, such as a capital reserve or a fee structure, rather than from operations. Those are very different things, and a prospective investor has every right to ask which one it is, in writing, with the underlying assumption named.

Your probate instinct is sound. Language that softens timeline risk does not change the timeline.

A tax or securities attorney should review any fund documents before you invest. That is a one-sentence point but it matters here.

One thing worth naming: the Rena strategy guide on data centers flags power delivery as the central site-selection factor and a genuine bottleneck. "Secured power" is the phrase it uses for the attribute that actually holds value. An interconnection study in progress is not secured power.

What did the fund documents say about what triggers the first distribution?