Keppel DC Reit and Keppel take 90% stakes in two Japan hyperscale data centres
Three of the 4 investment-grade customers across both Tokyo information centres are updated to the Reit’s portfolio, that broadens its client base and minimizes client concentration risk.
Keppel DC Reit said the purchase will increase its distribution per unit instantly while also providing several avenues of long-term revenue growth. The properties benefit from contracted average annual rent escalation of concerning 2.8%, and the in-place leas are approximated to be at the very least 30% below prevailing industry rents.
Its manager plans to fund the purchase with a mix of equity and yen-denominated debt. The deal is expected to be finished in the 4th quarter of this year.
The overall purchase rate on a 100% basis is JPY190 billion ($1.55 billion), that reaches a 2.1% price cut to the properties’ valuation of JPY194 billion, said the Reit supervisor in a Sept 1 bourse filing.
The weighted average rent expiry is roughly 4.5 years for Tokyo Data Centre 4 and 10.6 years for Tokyo Data Centre 5.
Keppel DC Reit will thus pay concerning JPY168.4 billion for its effective interest in both data centres.
Keppel DC Reit and Keppel are jointly obtaining 90% reliable interests in two freehold, hyperscale data centres– Tokyo Data Centre 4 and Tokyo Data Centre 5– in Greater Tokyo.
Loh Hwee Long, CEO of the manager of Keppel DC Reit, claimed this increases its network of institutional and operational partners, and enhances its ability to source and access future investment possibilities internationally.
The Reit will take an 88.62% claim in each data center, while Keppel, through its interest in Keppel Japan KK, will hold a 1.38% reliable interest.
Established in Inzai City, one of Japan’s the majority of established hyperscale data-centre clusters, both totally fitted, colocation properties are totally inhabited by four investment-grade internet enterprise and IT companies clients.
Meanwhile, the existing operator is going to preserve a 10% stake in each asset, to ensure “positioning of interests and working continuity”, the bourse filing said.
With the procurement, Japan’s contribution to the Reit’s portfolio leasing income enhances to around 23%, from 9% as at end-June this year.
