Keppel DC REIT to acquire first China data center for S$132M

China yuan coins

Keppel DC REIT entered a deal to acquire Guangdong Data Centre for 635.9 million yuan, or around S$132 million, from Guangdong Bluesea Data Development (Bluesea) and its parent company, Guangdong Bluesea Mobile Development.

The deal marks the REIT’s first data center acquisition in China, Keppel DC REIT said in a filing to SGX, adding it had a right of first refusal to acquire the remaining five data centers within the Bluesea Intelligence Valley Mega Data Centre Campus, located in Jiangmen, Guangdong Province.

On a pro forma basis, if the deal had been completed at the beginning of 2020, the REIT’s distribution per unit would have been 9.34 Singapore cents, compared with 9.17 Singapore cents without the deal, the filing said.

The deal, expected to be completed in the third quarter, will be funded via a combination of equity and/or debt.

The seven-storey property will be fully leased back to Bluesea on a triple net basis for 15 years, the REIT said.

“China is the second largest data centre market globally as well as the largest market in the Asia Pacific region, it is expected to continue its strong growth momentum,” Anthea Lee, CEO of the REIT’s manager, said in the statement.

“The strategic addition of Guangdong Data Centre enables us to ride on China’s growing digital economy and underscores our focus on investing in good quality data centre assets to provide stable and sustainable income,” she said.

The property was valued at 690 million yuan, or around S$143.2 million, by Savills Valuation and Professional Services (S) at the beginning of July, the statement said.

The acquisition will bring the REIT’s portfolio to 20 data centers across Asia Pacific and Europe.