Keppel DC Reit and Keppel take 90% stakes in two Japan hyperscale data centres
Keppel DC Reit said the acquisition will increase its distribution per unit instantly while also offering multiple channels of long-term income development. The assets benefit from acquired average annual lease escalation of regarding 2.8%, and the in-place rents are estimated to be a minimum of 30% listed below dominating industry rents.
Three of the four investment-grade clients throughout the two Tokyo data centres are new to the Reit’s profile, that widens its client base and reduces client focus risk.
Its manager prepares to fund the procurement with a mix of equity and yen-denominated debt. The deal is anticipated to be completed in the 4th quarter of this year.
Meanwhile, the existing operator is going to maintain a 10% stake in each asset, to assure “placement of interests and working continuity”, the bourse filing stated.
With the acquisition, Japan’s contribution to the Reit’s profile rental income increases to around 23%, from 9% as at end-June this year.
The Reit will take an 88.62% stake in each data centre, while Keppel, with its interest in Keppel Japan KK, are going to hold a 1.38% reliable interest.
Keppel DC Reit will certainly hence pay concerning JPY168.4 billion for its effective interest in both information centres.
The total acquisition price on a 100% basis is JPY190 billion ($1.55 billion), which is at a 2.1% discount to the properties’ assessment of JPY194 billion, stated the Reit administrator in a Sept 1 bourse declaring.
Keppel DC Reit and Keppel are jointly acquiring 90% reliable rate of interests in two freehold, hyperscale information centres– Tokyo Data Centre 4 and Tokyo Data Centre 5– in Greater Tokyo.
Established in Inzai City, among Japan’s most developed hyperscale data-centre clusters, both completely matched, colocation properties are fully inhabited by four investment-grade internet venture and IT companies clients.
Loh Hwee Long, CEO of the manager of Keppel DC Reit, stated this expands its network of institutional and operational partners, and strengthens its capacity to source and access future investment possibilities globally.
The weighted average lease expiry is about 4.5 years for Tokyo Data Centre 4 and 10.6 years for Tokyo Data Centre 5.
