Tel Aviv, Israel - January 6, 2026 - AI cloud infrastructure provider Nebius has signed a long-term agreement to lease 80 megawatts (MW) of data center capacity in Israel from Mega Or Holdings, marking one of the largest single leasing transactions in the country’s data center market to date.
The deal was signed with Mega DC, the data center development arm of Mega Or, and covers capacity across two purpose-built facilities currently under development. The sites include a 22 MW facility in Masmiyya and a 58 MW campus in Beit Shemesh, both designed to support high-density, AI-driven workloads.
According to details disclosed by Mega Or, the combined investment required to develop the two facilities is estimated at approximately USD 880 million, underscoring the rising capital intensity associated with AI-ready data center infrastructure.
Under the terms of the agreement, Nebius will lease the full 80 MW of capacity for an initial five-year term, with extension options built into the contract. Delivery of the Masmiyya site is scheduled to begin in the third quarter of 2026, while capacity at Beit Shemesh will come online in phases from Q3 2026 through Q1 2027.
The agreement significantly expands Nebius’ footprint in Israel, a market the company has increasingly targeted as demand for GPU-accelerated compute surges across enterprise AI, scientific research, and cloud services. Nebius is headquartered in the Netherlands and operates as a publicly listed company focused on scalable AI and cloud infrastructure.
This is not the first collaboration between the two companies. In May 2025, Nebius leased 8 MW of capacity in Modi’in from Mega DC, deploying Nvidia-based GPU infrastructure, including capacity allocated to support Israel’s national supercomputing initiative through the Israel Innovation Authority.
Mega Or, through its Mega DC subsidiary, is rapidly expanding its data center portfolio across Israel. The company has disclosed plans that exceed 500 MW of total potential capacity across multiple locations, positioning it as one of the country’s largest domestic data center developers.
The Nebius agreement reflects a broader trend of AI-focused cloud providers securing long-term power-backed capacity well ahead of delivery, as competition for data center space intensifies globally. With Israel emerging as a regional hub for AI research and advanced computing, large-scale leasing deals such as this are expected to accelerate further in 2026.
