Singapore’s Mapletree Industrial Trust buys 14 data centers in USA for $215m

Mapletree Industrial Trust (MIT), has completed their purchase of 14 data centers in the USA for US$215.3 million (S$292.8 million).

The Singapore Exchange listed real estate investment trust finished the acquisition of the remaining 60% interest in the data centers held by Mapletree Redwood Data Centre Trust, a trust formed by Mapletree Investments Pte Ltd and Mapletree Industrial Trust.

The deal, first announced in June, increased the Trust’s data center footprint to 39% of assets under management by the REIT.

To fund the deal, MIT initiated a private placement of 146.4 million new units at a price of US$2.05 (S$2.80) per unit. In the end, the Trust raised more than US$300 million (S$410 million), with demand coming from ‘a broad spectrum of investors, including new and existing institutional investors’.

Of the money raised, US$79.9 million will be used to repay MIT’s debt and fund future acquisitions, US$4.7 million will pay the fees incurred by the private placement, and the remaining US$215.9 million (S$294.5 million) will be spent on the acquisition of the 14 data centers.

The US data centers, originally acquired by Mapletree Redwood Data Centre Trust in 2017, are strategically placed around the country on freehold land with a lettable area of 2.3 million square feet in the following locations:

  • 2 Christie Heights, Leonia, New Jersey
  • 180 Peachtree Street, Atlanta, Georgia
  • 402 Franklin Road, Brentwood, Tennessee
  • 1001 Windward Concourse, Alpharetta, Georgia
  • 1221 Coit Road, Plano, Texas
  • 1805 Center Park Drive, Charlotte, North Carolina
  • 2000 Kubach Road, Philadelphia, Pennsylvania
  • 2775 Northwoods Parkway, Atlanta, Georgia
  • 3300 Essex Drive, Richardson, Texas
  • 5000 South Bowen Road, Arlington, Texas
  • 5150 McCrimmon Parkway, Morrisville, North Carolina
  • 7337 Trade Street, San Diego, Texas
  • 19675 W Ten Mile Road, Southfield, Michigan
  • N15W24250 Riverwood Drive, Pewaukee, Wisconsin

While MIT targets expansion into the United States, Equinix Singapore announced last month that it would buy the Trust’s Singapore data center known as SG3 for US$91.2 million (S$125 million).

Proceeds from the sale will be used to fund other Mapletree investments, reduce any existing debt or make distributions to unit holders.

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Equinix buys Mapletree Industrial’s Singapore data center for $91.2m

Equinix Singapore has agreed to buy Mapletree Industrial Trust’s Singapore data center for US$91.2 million (S$125 million).

Equinix Singapore gave notice to Mapletree that they wish to purchase the SG3 data center, for which they had been a fully leased tenant of since 2015.

The seven-storey data center was the only facility in Mapletree’s portfolio that provided Equinix with the option to purchase the data center.

The US$91.2 million sale price was valued by Savills Valuation and Professional Services on March 31 2020, taking into account a 23.3% premium over the development cost of US$74 million (S$101.4 million).

Mapletree announced in a Singapore Exchange filing on Friday that the data center brought in approximately 2.2% of the real estate investment trust’s gross revenue for the year ending March 31 2020.

The deal between Equinix Singapore and Mapletree is expected to be paid in cash by the fourth quarter of 2020, subject to the approval of JTC Corporation, the government agency responsible for industrial development.

Proceeds from the sale will be used to fund other Mapletree investments, reduce any existing debt or make distributions to unit holders.

The SG3 data center located at 26A Ayer Rajah Crescent, near Queenstown in Singapore, is Equinix’s largest data center in Asia Pacific, spanning 35,000 square metres and containing a 5,000 rack capacity.

Mapletree began constructing the data center in 2013 within the one-north business park, close to Equinix’s SG1 data center, enabling dark fibre interconnection.

The deal to purchase SG3 follows Equinix’s US$161 million expansion plan into India with their acquisition of two GPX data centers as well as a US$51m investment to support digital transformation in Hong Kong.

The global interconnection and data center company also announced a US$1 billion joint venture with Singapore’s sovereign wealth fund, GIC, to build three hyperscale data centers in Japan.

Uncover the importance of interconnectivity with W.Media

Interconnectivity in data centers has accelerated, as the need for connected devices and digital transformation is rapidly rising.

For a region like Asia Pacific that is rapidly going digital, data center providers are working hard to design connected platforms that enable global teams to collaborate with less downtime and latency.

Register now for our ‘Interconnecting into the Future’ digital event to discover how interconnectivity can help you reach your digital transformation desires.

Get involved in the conversation and connect with your peers on LinkedIn and Facebook using #WMediaEvent!