Keppel DC Reit and Keppel take 90% stakes in two Japan hyperscale data centres
Keppel DC Reit and Keppel are jointly acquiring 90% reliable interests in two property, hyperscale information centres– Tokyo Data Centre 4 and Tokyo Data Centre 5– in Greater Tokyo.
Keppel DC Reit will certainly thus pay regarding JPY168.4 billion for its effective rate of interest in the two information hubs.
The overall acquisition price on a 100% basis is JPY190 billion ($1.55 billion), which is at a 2.1% price cut to the properties’ assessment of JPY194 billion, stated the Reit supervisor in a Sept 1 bourse declaring.
The Reit will take an 88.62% stake in each data centre, whilst Keppel, through its interest in Keppel Japan KK, will hold a 1.38% effective interest.
Positioned in Inzai City, among Japan’s the majority of developed hyperscale data-centre clusters, both fully matched, colocation possessions are fully occupied by four investment-grade internet business and IT services clients.
With the acquisition, Japan’s contribution to the Reit’s portfolio leasing income enhances to around 23%, from 9% as at end-June this year.
Three of the 4 investment-grade clients across both Tokyo information facilities are updated to the Reit’s profile, which broadens its client base and minimizes client concentration risk.
The weighted average lease expiration is approximately 4.5 years for Tokyo Data Centre 4 and 10.6 years for Tokyo Data Centre 5.
Loh Hwee Long, CEO of the executive of Keppel DC Reit, claimed this expands its network of institutional and functional partners, and strengthens its ability to source and access future investment possibilities globally.
Keppel DC Reit said the purchase will boost its distribution per unit immediately while also providing multiple channels of long-term income development. The assets gain from contracted average annual lease rise of concerning 2.8%, and the in-place leas are estimated to be a minimum of 30% below dominating industry rents.
Its manager prepares to finance the acquisition with a mix of equity and yen-denominated debt. The deal is expected to be finished in the 4th quarter of this year.
On the other hand, the existing operator will preserve a 10% stake in each asset, to ensure “placement of interests and operational continuity”, the bourse filing stated.
