KEPPEL DC Real Estate Investment Trust (Reit) Keppel DC Reit: AJBU +0.4% has acquired two data centre buildings in Eindhoven, the Netherlands for 37.2 million euros (S$59.9 million), its manager said in a bourse filing on Monday.

 

The freehold property, located in Eindhoven' s largest business park De Hurk, is the Reit' s third asset in the Netherlands, and " further strengthens its foothold in this key data centre market in Europe" , the manager said.

 

Named Eindhoven Campus, the property has a combined net lettable area of 83,841 square feet and is fully leased with a weighted average lease expiry (WALE) of 6.8 years by leasable area and 8.5 years by rental income. The data centre space is leased to a global leading IT services provider, the Reit' s manager said.

 

The manager expects the acquisition will be accretive to Keppel DC Reit' s distribution per unit. With the addition of Eindhoven Campus, Keppel DC Reit' s portfolio occupancy rate will also improve to 98.1 per cent from 98 per cent as at June 30, 2021, while its WALE remains unchanged at 6.5 years.

 

The acquisition is funded by euro-denominated debt and by the proceeds from the Reit' s recent equity fund raising.

 

Eindhoven Campus' market value was 35.4 million euros (S$57.1 million), based on the valuation on July 7 by an independent valuation firm appointed by the trustee of the Reit.

 

On July 26, the manager of Keppel DC Reit Keppel DC Reit: AJBU +0.38% , Keppel DC Reit Management, announced its first data centre acquisition in China. The seven floor fully fitted data centre facility in Jiangmen, Guangdong Province has a gross floor area of approximately 20,595 sq m (221,689 sq ft).

 

As part of the agreement, Keppel DC Reit will have the right of first refusal to acquire the remaining five data centres to be developed within the Bluesea Intelligence Valley Mega Data Centre Campus.

 

The purchase consideration for the Guangdong Data Centre is 635.9 million yuan (approximately S$132.0 million), which represents a 7.8 per cent discount to the independent market valuation and will be funded by a mix of debt and/or equity.

 

Post completion, the aggregate leverage of Keppel DC Reit is expected to increase to 37.5 per cent (from 36.7 per cent as at June 30, 2021). With completion expected in Q3 2021, the acquisition is distribution per unit (DPU) accretive.

 

In February, Anthea Lee was appointed CEO of Keppel DC Reit Management after joining the manager in 2015 as head of investment and asset management.

 

Ms Lee has been instrumental in growing Keppel DC Reit through various accretive acquisitions, and was appointed deputy CEO and head of investment in 2018. She has been actively involved in all aspects of Keppel DC Reit' s business.

 

For its H1FY21 (ended June 30), Keppel DC Reit achieved a 12.4 per cent year-on-year growth in distributable income to S$84.3 million, due mainly to contributions from acquisitions and completion of asset enhancement initiatives.

 

The DPU of 4.92 cents for H1FY21 goes ex-dividend on Aug 2 and is 12.5 per cent above the H1FY20 DPU.

 

As at May 31, Temasek maintained a 22.97 per cent deemed interest in the units of Keppel DC Reit mostly through Keppel Corporation, which maintained a 20.95 per cent interest, in addition to interests maintained by Fullerton, DBS and SeaTown.