[SINGAPORE] The manager of Keppel DC Real Estate Investment Trust (Keppel DC Reit) plans to capitalise on sponsor Keppel’s intended expansion of its portfolio of data centres to a gross power capacity of 1.2 gigawatts (GW) in the near term, it said in the annual report released on Monday (March 24).
“(That) will form a pipeline of assets that Keppel DC Reit may potentially acquire. Moreover, Keppel’s established track record and the extensive network with industry players provide us with access to exclusive, off-market deals from third parties,” said Christina Tan, chairman of Keppel DC Reit’s manager.
“We will continue to optimise our capital structure to support our growth ambitions,” she added.
In July 2024, the Reit acquired Tokyo DC 1, a three-storey shell and core data centre in West Tokyo, for 23.4 billion yen (S$209.2 million) In November, the Reit announced its acquisition of two artificial intelligence (AI)-ready data centres in Singapore, KDC SGP 7 and 8, for S$1.4 billion from its sponsor Keppel.
In its earnings release in February 2025, Keppel announced that its data centre portfolio had reached a gross power capacity of 650 megawatts in 2024, up by a factor of 2.7 times from 2018.
On top of its upcoming Bifrost Cable System (slated for completion in H2 2025), Keppel’s connectivity business is exploring the development of two more subsea cable systems between South-east Asia and other Asian regions, the company said. Keppel intends to expand its portfolio power capacity to 1.2 GW in the next few years, it added, capitalising on opportunities from rapid growth in digitalisation and AI.
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The Reit’s asset portfolio distribution is currently made up of 65.3 per cent in Singapore, with an additional 15.4 per cent of its data centre assets based in Asia-Pacific countries including Australia, China, Japan and Malaysia.
The manager posted a distribution per unit for FY2024 of S$0.09451, up 0.7 per cent on the year.
For the full year, net property income was up 6.3 per cent at S$260.3 million, from S$245 million previously. Revenue rose 10.3 per cent on the year to S$310.3 million. Distributable income was up 3 per cent at S$172.7 million, from S$167.7 million previously.
As at Dec 31, 2024, the Reit’s portfolio is valued at S$4.83 billion, with a total of 25 data centres across 10 countries. The Reit manager added that it would continue to pursue investments in newer and AI-ready assets.
Rising demand on growing AI market in Apac
The data centre market’s rapid expansion has been underpinned by growth from global cloud service providers, which accounted for 22.7 per cent of global supply in 2024, noted an independent review on the global data centre market by research firm DC Byte.
Additionally, with a surge in adoption of AI services, demand for co-located data centre services has sharply increased, averaging 43.9 per cent compound annual growth rates from 2019 to 2024.
DC Byte noted that while the supply of co-location services in the Asia-Pacific region has seen the most significant growth, especially in established markets such as Australia and Japan, emerging markets in South and South-east Asia present untapped potential for data centre demand, fuelled by the emergence of AI.
The Asia-Pacific’s AI market is projected to grow to US$82 billion by 2024, and at a compound annual rate of 17.5 per cent to reach US$215 billion by 2030, the report noted.
Further investments are expected to flow into these markets, driven by population growth and demographics, as well as improvements in digital infrastructure and data sovereignty regulations.
