The manager of NTT DC REIT said that it has registered its prospectus with the Monetary Authority of Singapore (MAS) for its initial public offering (IPO) which it hopes to raise US$773 million ($988 million).
The REIT will have 1,030,209,500 units, and it will be the largest REIT IPO on the Singapore Exchange (SGX) in more than a decade.
The offering of almost 600 million units to investors, including institutional and other investors outside the US is at US$1 per unit, and the rest of the 30 million units to the public Singapore are at $1.276 per unit.
The REIT’s cornerstone investors are GIC, AM Squared, Ghisallo Master Fund, Hazelview Securities, Pinpoint Asset Management (Singapore), UBS (acting through its Singapore branch), and Viridian Asset Management Limited. They have entered into separate subscription agreements to subscribe for an aggregate of 172.77 million units, about 16.8% of the total number of units.
GIC specifically has committed to 100,880,000 units or 9.8% of the total units in the issue, and will be a substantial unitholder immediately upon listing. The sponsor NTT has also entered a sponsor subscription agreement, which is concurrent with but separate from the offering, to subscribe 257,552,400 units in total or about 25% of all units.
About NTT DC REIT
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NTT DC REIT’s initial portfolio has six carrier-neutral, Tier III or Tier III-equivalent assets diversified across US, Austria and Singapore, with a mix of hyperscale and colocation customer contracts.
It has an appraised value of US$1.572 billion with an IT load of about 90.7 megawatts (MW). All the assets are freehold except for the Singapore asset, which is a leasehold land expiring in 2070.
The REIT’s portfolio comprises hyperscale customers, which includes global cloud service providers and major international tech giants, which account for 51% of its total monthly base rent as at Dec 31, 2024. Customers from a broad range of industries make up the remaining 49%.
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As at Dec 31, 2024, the IPO portfolio stood at 94.3%, with a weighted average lease expiry of 4.8 years. The IPO’s lease export profile has no single financial year seeing lease expire in excess of 20% of monthly base rent in the next five financial years.
The IPO portfolio also enjoys built-in organic growth from contractual escalations, with 74.6% of contracts with fixed escalations of 3.3% on average and 3.0% of contracts with Consumer Price Index- linked escalations.
NTT DC REIT says there could also be potential earnings uplift from asset enhancement initiatives such as the implementation of improved cooling methods and the upgrading of integral mechanical, electrical and plumbing systems, which can help to improve operational efficiencies and lower operating costs.
The public offer opens July 7, 9pm and closes July 10, 12pm. Units are expected to commence trading on July 14, 2pm.
Douglas Stuart Adams, CEO of NTT Global Data Centers, says: “NTT DC REIT is a strategic pillar of NTT’s long-term capital strategy to scale our global data centre business. As a leading global telecommunications and technology group, we are committed to supporting NTT DC REIT with a portfolio of best-in-class, stabilised data centre assets for the long run, while continuing to reinvest in new data centre developments through disciplined capital recycling."
