CPPIB commits $350m to SG’s Keppel-backed data centre fund, option to invest another $150m

Brand logo Canada Pension Plan Investment Board (CPPIB)

Canada Pension Plan Investment Board (CPPIB) will invest up to $350 million in Singapore-based Keppel Capital’s Alpha Data Centre Fund (ADCF) that aims to develop a portfolio of new and existing data centre assets in Asia Pacific and Europe.

In an announcement, CPPIB said that there is also an option to invest another $150 million. The announced investment will double ADCF’s combined and co-investment interest up to $1 billion, double the fund’s initial target size of $500 million.

“When fully leveraged and invested, the fund will potentially have assets under management of approximately $2.3 billion,” the announcement said.

ADCF is managed by Alpha Investment Partners Limited, the private fund management arm of Keppel Capital.

“The Alpha Data Centre Fund is a prime example of how we can harness synergy and expertise across the Keppel Group to create value and deliver enhanced returns to investors. The strong interest garnered and successful closing of the Fund are testament to Keppel’s ability to grow our capital platform with investments from quality global institutional investors,” said Christina Tan, CEO of Keppel Capital and Managing Director of Alpha.

ADCF was launched in July 2016 by Alpha amid interest from institutional investors for quality alternative asset classes. The collaboration taps Keppel Data Centre’s experience in designing, building and managing data centres for more than a decade. Keppel Data Centres is a 70:30 joint venture between Keppel Telecommunications & Transportation Ltd. and Keppel Land Limited.

“The continued strong growth in data requirements globally has driven demand for quality data centre space, particularly in the Asia-Pacific region where digital infrastructure is relatively under-developed,” said Jimmy Phua, Managing Director and Head of Real Estate Investments Asia, CPPIB.

He added that by investing alongside the Alpha Data Centre Fund, CPPIB is able to gain exposure into this critical sector.

In July 2017, ADCF acquired a 70 per cent stake in the Keppel DC Singapore 4, a carrier-neutral data centre which features approximately 182,000 sq. ft. of gross floor area. Earlier in late 2016, it announced its maiden acquisition of a 60 per cent interest in Keppel DC Frankfurt 1 in Germany, a two-storey facility located in close proximity to the city centre and Frankfurt airport.

Also Read:

Myanmar group Dagon International takes 14% stake in Burst Networks’ data centre

Data centre provider Digital Realty eyes M&As, partnerships for Asia growth

SG Realty: Keppel DC REIT deal; Hetton acquisition; Mapletree Logistics fundraise