CapitaLand Ascendas REIT has recently completed the acquisition of a high-quality data center facility located in Singapore. This strategic move marks a significant expansion of the REIT’s portfolio within the thriving digital economy sector.
The acquired property is a fully operational and well-established data center, crucial infrastructure supporting the growing demand for data storage and processing driven by trends like cloud computing, e-commerce, and artificial intelligence. Situated in a prime industrial area in Singapore, a key regional hub for technology and connectivity, the facility is poised to benefit from strong market fundamentals.
The total purchase consideration for the acquisition was approximately S$104.5 million. This value reflects current market conditions and the premium quality of the asset. The transaction was funded through a mix of debt and equity, aligning with the REIT’s prudent capital management strategy.
This investment is expected to enhance CapitaLand Ascendas REIT’s income stability and growth potential. Data centers typically feature long-term leases with strong tenants, providing reliable and predictable rental income streams. The growing reliance on digital services ensures continued high occupancy and demand for such facilities.
The acquisition aligns perfectly with the REIT’s strategy to pivot towards new economy assets, including logistics facilities, business parks, and data centers. These sectors are demonstrating resilience and growth potential compared to traditional real estate classes. By expanding its footprint in the data center space, CapitaLand Ascendas REIT is positioning itself to capitalize on the acceleration of digital transformation across industries.
The management anticipates that the acquisition will be immediately yield-accretive, contributing positively to the REIT’s distribution per unit (DPU) from the outset. This reinforces the commitment to delivering value to unitholders.
This move underscores Singapore’s continued importance as a strategic location for data center investments in the Asia Pacific region, supported by robust infrastructure, connectivity, and a favorable business environment. The addition of this data center strengthens CapitaLand Ascendas REIT’s position as a leading player in the industrial and business space sector, with an increasingly diverse and future-ready portfolio.
Source: https://www.datacenterdynamics.com/en/news/capitaland-ascendas-reit-acquires-singapore-data-center-from-capitaland/
