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Digital Realty confirms intention to explore Singapore REIT IPO

News first broke last June of a potential $1 billion public offering in Asia cementing the market demand for colocation facilities being felt across the region.

By João Marques Lima

Co-founder and Editor, The Tech Capital

3 Mins

October 04, 2021 | 1:12 PM BST

Digital Realty (NYSE: DLR) has confirmed its intention to explore the listing of a new real estate investment trust (REIT) in the Singaporean stock exchange (SGX-ST) which would see the US giant join other local REIT’s including Mapletree, Ascendas Reit (CapitaLand), and Keppel DC REIT.

The company, which currently enjoys an enterprise value of US$58 billion, said in Form 8-K filling that should it move ahead with the IPO, “the Singapore REIT would initially be comprised of a portfolio of income-producing data centres to be acquired from, and externally managed by, Digital Realty”.

However, the US operator added that the establishment of the Singapore REIT and the potential listing on the SGX-ST “would be subject to market conditions, requisite regulatory approvals and the execution of definitive agreements by relevant parties, among other considerations”.

“If executed, the transaction would not be expected to have a material impact on Digital Realty’s financial condition or reported results,” Digital Realty’s filing shows.

News of the potential IPO first emerged last June when Bloomberg reported that the company was exploring the potential IPO of around $1 billion in data centre assets.

The plan would consist of originally raising $300-$400 million in equity by selling ten data centres before the end of 2021 which would then be managed by DLR’s Singaporean REIT entity.

Digital Realty operates three facilities in Singapore amounting to nearly one million square feet, part of a global portfolio with 291 facilities in 47 metros across 24 countries on six continents.

In its latest financial results, the company set out a 2021 revenue outlook to $4.325 – $4.425 billion and an adjusted EBITDA of $2.350 – $2.400 billion.

Digital Realty has said it will release financial results for the third quarter of 2021 after the market closes on Tuesday, October 26, 2021.

One of the company’s largest projects of 2021 so far has been the establishment of a multi-billion Dollar data centre business investment and operating arm in India in a partnership with Brookfield Infrastructure L.P. (TSX: BIP.UN; NYSE: BIP).

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João Marques Lima

Co-founder and Editor, The Tech Capital

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