Merlin Properties, a property group listed on Spain’s Ibex 35, has told analysts that CoreWeave accounted for 8.6% of the company’s total rents in the first half of 2026, but for roughly 80% of its data centre business, according to a Jefferies note published on 19 October 2026 and reported by El Español, PressDigital and Merca2. Merlin gave the figures after its shares fell on doubts about the US neocloud’s finances.
CoreWeave is a US neocloud that rents out AI computing capacity; the capacity it leases from Merlin is used in full by CoreWeave’s end customers, according to the Jefferies note as Merca2 reported it. As we read it, the disclosure shows how the debate over neocloud debt now reaches the companies that own the buildings and the power connections.
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The key insight: As we read it, Merlin’s disclosure separates two exposures that headlines blur: 8.6% of the group’s rents today, and roughly 80% of the data centre capacity it has let so far.
8.6% of group rents. CoreWeave represents only 8.6% of the rents the company received in the first half of 2026, Merlin said, as PressDigital reported.
About 80% of data centres. The tenant still represents approximately 80% of Merlin’s data centre business, which Merca2, reporting the Jefferies note, put as about 80% of the 160 megawatts that are operating or pre-let in phases I and II.
An early platform. Merlin attributed the concentration to the early stage of its data centre platform: 160 MW operating or pre-let out of 724 MW expected in total across the first three phases, according to El Español.
A 20% cap, later. Merlin aims to keep any single client below 20% of the business once the project is fully developed, and said bookings in Madrid and negotiations in Lisbon involve operators other than CoreWeave, El Español reported.
Merlin’s data centre plan: 724 MW expected across phases I to III, 160 MW operating or pre-let, and CoreWeave’s roughly 80% of that 160 MW, about 128 MW by our arithmetic. Merlin says CoreWeave was 8.6% of group rents in the first half of 2026. Figures from Merlin’s H1 2026 release and its explanations to analysts as reported from a Jefferies note.
The Protections Merlin Cites
Merlin said it has contractual guarantees on the contracts signed with CoreWeave, and that in the event of a hypothetical non-payment it has the power to cut off the electricity supply and invoke the legal protections over the installed technology equipment, PressDigital reported (our translation). Merca2, quoting the Jefferies note, added that Merlin highlighted the protections of Spanish law and of contractual agreements over the installed computer equipment, including compensation rights if that equipment is removed (our translation).
Merlin’s management argues that the scarce resource is the electrical connection combined with an already equipped data centre, which would support re-letting the facilities to another operator, according to the note as Merca2 reported it. Jefferies analyst Stephanie Dossmann wrote that tenant concentration remains a short-term risk, but that Merlin highlighted several factors that could mitigate an adverse scenario: contractual guarantees, valuable installed equipment, the scarcity of connected power and the flexibility to re-let the spaces, according to Merca2 (our translation).
Merlin also described CoreWeave’s business model as cash-flow positive, with almost all of its 2027 capacity sold and contracting already under way for 2028 and later years, Merca2 reported, citing the note. Those are Merlin’s descriptions of its tenant as relayed by Jefferies, not figures from CoreWeave.
What Merlin’s Own Results Show
Merlin’s first-half release of 27 July 2026 reported total revenues of €308 million, including gross rents of €292 million, and said growth was driven by data centre rents. It said phase I of its data centre plan, 64 MW of IT capacity, is fully equipped and let, with revenues estimated at €68 million for 2026, and that the company had reached 160 MW let or pre-let. The release does not name CoreWeave.
Our arithmetic: if the 8.6% share applies to the €292 million of gross rents, CoreWeave paid Merlin about €25 million in the half. Merlin and Jefferies did not give a euro figure in the reports we read, so this is an estimate on that assumption only.
The Market Read
Merlin’s shares have fallen more than 25% since June, El Español reported, and the paper said CoreWeave’s shares have fallen 56% since May. Jefferies kept its buy rating and a €16 price target, a potential gain of 37% from €11.66, and argues that the recent fall already prices in most of the CoreWeave risk, PressDigital reported. Jefferies wrote, as Merca2 reported, that Merlin’s near-term economic exposure is more limited than the concentration in the headlines suggests (our translation).
Merlin reports its nine-month results on Friday, 13 November, according to Merca2.
Update, 21 October: Piper Cuts Its CoreWeave Target to $124
Two analysts reiterated their ratings on CoreWeave on 20 October, according to TipRanks’ record of the notes. Piper Sandler’s James Fish kept a Buy rating and cut his price target to $124 from $153. Barclays’ Raimo Lenschow kept a Hold rating with a $105 target.
TipRanks lists the ratings and targets only; the notes’ reasoning is not in what we read.
Connecting the Coverage
Our piece on HSBC and Goldman reported on 20 October that the two banks read CoreWeave’s debt differently: HSBC set a $39 target and wrote that CoreWeave earns a return on invested capital below its cost of borrowing, while Goldman upgraded the stock to buy and described its main funding method as asset-backed project financing. Our neocloud shakeout piece the same day covered The Information’s report that executives expect only seven to 10 of hundreds of neoclouds to survive.
Our Elice piece reported Bloomberg’s account of a Korean neocloud debut that fell as much as 32%, set against CoreWeave’s shares having more than halved since their May peak. What is new here is the landlord’s side: a European property company putting a number on how much of its income depends on one neocloud, and saying what it can do if that tenant stops paying.
What It Means for Landlords and Investors
As we read it, Merlin’s two figures answer different questions. The 8.6% measures the risk to the group’s income today; the roughly 80% measures how much of its data centre bet rests on one tenant until other leases arrive.
As we read it, the protections Merlin lists rest on one claim: that a powered, equipped data centre can be re-let quickly. The reports we read do not show a re-letting price or timetable.
The Structural Read
As we read it, the 8.6% is the near-term number for the group’s income, while the roughly 80% is the number for its data centre strategy until leases in Madrid and Lisbon with other operators arrive.
As we read it, Merlin’s protections, from cutting power to legal rights over installed equipment, all rest on its claim that a powered, equipped building can be re-let; the reports we read do not show at what rent or how fast.
As we read it, the landlord’s view joins the bank views in our earlier coverage: HSBC and Goldman read CoreWeave’s debt differently, and Merlin now says how much of its own income rides on the answer.
HSBC analyst Abhishek Shukla, as reported by CNBC, 20 October 2026
“CoreWeave earns an average 2026-30e [return on invested capital] of 8.9%, below its cost of borrowing.”
Three Implications
FOR LANDLORDS Merlin said it aims to keep any single client below 20% of the business once its data centre project is fully developed, El Español reported.
FOR INVESTORS Jefferies kept a buy rating and a €16 target on Merlin, arguing that the recent share fall already prices in most of the CoreWeave risk, PressDigital reported.
FOR NEOCLOUD LENDERS Merlin said that on non-payment it could cut off the electricity supply and invoke legal protections over installed equipment, PressDigital reported (our translation).
The framework states its thesis in one line: “The structural bottleneck isn’t computing, it’s electrons.”
As we read it, Merlin’s defence uses the same logic from the landlord’s side: it argues that the scarce asset is the power connection plus an equipped building, not the tenant. The framework was published in December 2025 and does not discuss Merlin or CoreWeave.
What Is Not Established
The figures come from Merlin’s explanations to analysts as summarised in a Jefferies note and reported by Spanish outlets; we did not read the note itself or a Merlin filing that contains them. The reports we read do not give the rent CoreWeave pays, the length of its leases or the size of the guarantees. CoreWeave’s financial position is described here as Merlin and Jefferies described it. The €25 million is our arithmetic on a stated assumption.
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Merlin Properties says CoreWeave was 8.6% of its rents in the first half of 2026 and roughly 80% of the 160 MW its data centre arm has let or pre-let, according to a Jefferies note of 19 October 2026. As we read it, that is the first landlord-side number in our coverage of the neocloud credit debate.
A note on sourcing. This piece is built on reports by El Español, PressDigital and Merca2 of a Jefferies note of 19 October 2026 on Merlin Properties’ explanations to analysts, read in full in Spanish; English renderings of Spanish text are our translation. We did not read the Jefferies note itself. Merlin’s own figures come from its first-half 2026 results release, read in full. The €25 million and 128 MW figures are our arithmetic. We did not contact Merlin, CoreWeave or Jefferies. Nothing here is legal, financial or investment advice.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
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