Key Takeaways
- Keppel DC REIT (AJBU) reported a 9M 2025 Distribution Per Unit (DPU) of 7.670 Singapore cents, reflecting solid operational performance.
- The REIT achieved a distributable income of S$195.3 million and a net property income of S$280.2 million for the nine months ended September 30, 2025.
- These strong results follow a successful preferential offering in October 2025 that raised approximately S$404.5 million to fund strategic acquisitions and debt repayment.
Keppel DC REIT (AJBU) has announced a strong financial performance for the first nine months of 2025, with its Distribution Per Unit (DPU) reaching 7.670 Singapore cents. This comes alongside a significant distributable income of S$195.3 million and a net property income of S$280.2 million for the period. The results underscore the continued growth and resilience of the data centre sector.
The positive 9M performance builds on the REIT's earlier half-year results, where its 1H 2025 DPU increased by 12.8% year-on-year to 5.133 cents, with distributable income rising 57.2% year-on-year to S$127.1 million. This growth was primarily driven by contributions from recent acquisitions, including Keppel DC Singapore 7 & 8 and Tokyo Data Centre 1, along with contract renewals and escalations.
Further bolstering its financial position and growth prospects, Keppel DC REIT successfully concluded a fully underwritten, non-renounceable preferential offering in October 2025. The offering raised approximately S$404.5 million in gross proceeds, demonstrating strong investor confidence with an oversubscription rate of approximately 168.2%. The new units commenced trading on the Singapore Exchange (SGX) on October 22, 2025.
The capital raised from the preferential offering is strategically earmarked for several key initiatives. A significant portion will be used to partially fund the acquisition of Tokyo Data Centre 3, a newly built hyperscale facility in Greater Tokyo, fully leased to a global hyperscaler under a 15-year agreement. This acquisition is expected to enhance the REIT's exposure to stable, long-term cash flows and deepen its presence in Japan's mature data centre market. Additionally, funds will be deployed to repay existing debt, which is anticipated to improve the balance sheet and reduce financing costs.
As of June 30, 2025, Keppel DC REIT maintained a healthy aggregate leverage of 30.0%, with an average cost of debt decreasing to 3.0% for 1H 2025, benefiting from lower floating rates. These prudent financial management strategies, combined with the recent capital raise, position Keppel DC REIT favorably to capture further acquisition opportunities within the hyperscale segment amidst the rising demand for digital infrastructure and artificial intelligence (AI).
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.