Keppel DC Reit and Keppel take 90% stakes in two Japan hyperscale data centres
Loh Hwee Long, CEO of the manager of Keppel DC Reit, said this increases its network of institutional and functional partners, and strengthens its capability to source and access future investment possibilities internationally.
The Reit will take an 88.62% stake in each data centre, while Keppel, through its interest in Keppel Japan KK, are going to hold a 1.38% reliable interest.
The weighted average lease expiry is roughly 4.5 years for Tokyo Data Centre 4 and 10.6 years for Tokyo Data Centre 5.
Three of the four investment-grade customers throughout the two Tokyo data centres are new to the Reit’s portfolio, that expands its client base and minimizes client focus risk.
Its manager prepares to finance the purchase with a mix of equity and yen-denominated debt. The deal is anticipated to be completed in the fourth quarter of this year.
Keppel DC Reit and Keppel are collectively getting 90% efficient interests in 2 property, hyperscale information centres– Tokyo Data Centre 4 and Tokyo Data Centre 5– in Greater Tokyo.
On the other hand, the existing operator will keep a 10% risk in each asset, to assure “placement of interests and operational continuity”, the bourse filing said.
The overall purchase price on a 100% basis is JPY190 billion ($1.55 billion), which is at a 2.1% discount to the properties’ valuation of JPY194 billion, said the Reit administrator in a Sept 1 bourse declaring.
Positioned in Inzai City, one of Japan’s many established hyperscale data-centre clusters, both completely matched, colocation possessions are totally inhabited by four investment-grade internet venture and IT services clients.
Keppel DC Reit will therefore pay regarding JPY168.4 billion for its effective interest in both data centres.
With the acquisition, Japan’s contribution to the Reit’s account rental income enhances to around 23%, from 9% as at end-June this year.
Keppel DC Reit said the procurement will increase its distribution per unit instantly whilst also providing several channels of long-term revenue growth. The assets benefit from acquired average annual lease rise of concerning 2.8%, and the in-place leas are approximated to be at least 30% below dominating industry rents.
