Singapore’s CapitaLand is acquiring its first hyperscale data centre campus in China, the world’s second largest data centre market and the largest in Asia Pacific, for RMB3.66 billion (approximately S$757.7 million).
CapitaLand will acquire the data centre campus via the purchase of 100% equity interest in two companies registered in China.
Located in Minhang District, an established data centre hub in Shanghai, the operating data centre campus serves two of China’s largest telecommunications companies.
The hyperscale data centre campus comprises four buildings with a gross floor area of up to 75,000 square metres and up to 55 megawatts of IT power capacity. CapitaLand is acquiring the data centre campus from AVIC Trust, an investment arm of Shanghai-listed AVIC Capital, and from an unrelated third-party vendor.
The acquisition is expected to be completed by 3Q 2021, subject to fulfilment of certain conditions precedent.
CapitaLand’s strategic decision to expand into new economy assets such as data centres, capitalises on the increasing global connectivity and demand for data which has accelerated amid COVID-19. CapitaLand aims to grow its data centre portfolio into a global business by leveraging its in-house data centre design, development and operational capabilities.
“5G, artificial intelligence and big data are driving the growth of the digital economy and creating strong demand for data centres. Data centres are a growing new economy asset class and represent a global investment opportunity and a key strategic business focus for CapitaLand,” said Ms He Jihong, Chief Executive Officer, Data Centre and Chief Corporate Strategy Officer, CapitaLand Group.
”In Europe, CapitaLand’s business space and industrial REIT, Ascendas Real Estate Investment Trust (Ascendas Reit) recently acquired 11 data centres in key markets that complement its existing data centre portfolio in Singapore, expanding its presence into key European data markets,” she added.
“CapitaLand’s entry into the data centre market in China will further diversify our portfolio across asset classes and build more operating capabilities,” said Mr Puah Tze Shyang, Chief Executive Officer, Investment and Portfolio Management, CapitaLand China.
”We see strong potential to expand our data centre portfolio in cities such as Shanghai, Beijing, Shenzhen and leverage our growing base of new economy assets to bolster our fund management business in tandem,” he added.