Keppel DC REIT, a data center-focused real estate investment trust in Singapore, today announced its financial results for the full-year ended December 31, 2021 (FY 2021) and shared its latest valuation marks for its data center portfolio.
Financial Performance in FY 2021 – Keppel DC REIT
In FY 2021, Keppel DC REIT reported gross revenue of S$271.1m ($200.5m USD), a 2.1% increase year-over-year, and net property income of S$248.2m ($183.5m USD), a 1.6% increase year-over-year. Therefore, the company’s net property income margin was 91.5% in FY 2021, a ~40 bps decline year-over-year.
Operational Performance in FY 2021 – Keppel DC REIT
Pro forma for pending acquisitions, Keppel DC REIT operates 21 data centers in Asia-Pacific and Europe comprising 2.6 million sqft. As of December 31, 2021, this data center portfolio amounted to assets under management (AUM) of S$3.5bn ($2.6bn USD). Geographically, ~54% of Keppel DC REIT’s portfolio valuation is derived from its Singapore data centers.
|Keppel DC Singapore 1||Singapore||110k||S$336m||$248m|
|Keppel DC Singapore 2||Singapore||38k||S$183m||$135m|
|Keppel DC Singapore 3||Singapore||49k||S$281m||$208m|
|Keppel DC Singapore 4||Singapore||84k||S$422m||$312m|
|Keppel DC Singapore 5||Singapore||93k||S$356m||$264m|
|Basis Bay Data Centre||Cyberjaya, Malaysia||48k||S$22m||$16m|
|Gore Hill Data Centre||Sydney, Australia||91k||S$224m||$166m|
|Intellicentre Campus||Sydney, Australia||174k||S$102m||$76m|
|Guangdong Data Centre||Guangdong, China||222k||S$148m||$109m|
|Cardiff Data Centre||Cardiff, UK||79k||S$47m||$35m|
|GV7 Data Centre||London, UK||25k||S$66m||$49m|
|London Data Centre||London, UK||95k||S$106m||$78m|
|Almere Data Centre||Almere, Netherlands||118k||S$155m||$115m|
|Amsterdam Data Centre||Amsterdam, Netherlands||142k||S$45m||$33m|
|Eindhoven Campus||Eindhoven, Netherlands||84k||S$57m||$42m|
|Keppel DC Dublin 1||Dublin, Ireland||68k||S$151m||$111m|
|Keppel DC Dublin 2||Dublin, Ireland||28k||S$141m||$104m|
|Milan Data Centre||Milan, Italy||165k||S$61m||$45m|
|maincubes Data Centre||Offenbach, Germany||97k||S$155m||$115m|
|Kelsterbach Data Centre||Kelsterbach, Germany||541k||S$124m||$92m|
For FY 2021, Keppel DC REIT marked-up the valuation of its six Singapore data centers by an average of 11%, as compared to FY 2020. Specifically, this valuation uplift, in isolation, was equivalent to S$185.9m ($137.5m USD). For example, the company’s DC1 facility was marked-up by 29%, while Keppel DC Singapore 3 had its valuation increased by 18%.
As of FY 2021, Keppel DC REIT’s portfolio occupancy rate was 98.3%, with a weighted average lease expiry (WALE) of 7.5 years by leased area. Notably, the company has near-term vacancy risk at its Keppel DC Singapore 4 (0.7-year WALE) and Basis Bay Data Centre in Malaysia (0.5-year WALE) facilities.
Keppel DC REIT notes that it has a data center acquisition pipeline of >S$2bn ($1.5bn USD). Specifically, these data center assets are under development and management through Keppel Telecommunications & Transportation (T&T) and Keppel’s private data center funds. For example, Keppel T&T has granted rights of first refusal (ROFR) to Keppel DC REIT for future acquisition opportunities of its data center assets.
Additionally, Keppel DC REIT has a ROFR for the remaining 5 data centers within Bluesea’s campus in Jiangmen, Guangdong, China.
Acquisitions, Divestitures in FY 2021 – Keppel DC REIT
Keppel DC REIT expanded its portfolio in FY 2021 with ~$285m USD in acquisitions of data centers and network assets.
During 2021, Keppel DC REIT pursued the following data center acquisitions and divestitures:
- United Kingdom: acquiring a data center and office property, known as Waterside House, in Bracknell, United Kingdom for £57.0m ($76.5m USD)
- Netherlands: acquired two data center buildings in Eindhoven, the Netherlands, for €37.2m ($44.2m USD)
- China: acquired a fully-fitted data center facility in the city of Jiangmen, Guangdong Province, China for $98.4m USD (RMB636m)
- Australia: divested its iseek Data Centre located in Brisbane, Australia, for A$34.5m ($25.0m USD) to iseek
Mobile, Fixed, and Fiber
Beyond data centers, Keppel DC REIT expanded its investment mandate to include real estate and assets in the “digital connectivity” sector. As such, in 2021, Keppel DC REIT invested in M1’s mobile, fixed, and fiber assets (NetCo), purchasing $65.8m USD (S$88.7m) of bonds and $740k USD (S$1.0m) in preference shares issued by NetCo.