The manager of Keppel DC REIT, on March 21 announced that Keppel DC Singapore 1 has commenced a suit against DXC Technology Services Singapore in Singapore’s High Court.
Keppel DC Singapore 1 is the master lessee and appointed facility manager of the data centre located at 25 Serangoon North Avenue 5.
The dispute is said to pertain to DXC’s partial default of payment in connection with the provision of colocation services at the data centre.
DXC has disputed its liability to make payment.
According to the REIT manager, a portion of the revenue from Keppel DC Singapore 1, which is generated from its management of the data centre, is payable to Keppel DC REIT, under the lease and facilities management arrangement between Keppel DC Singapore 1 and Keppel DC REIT.
The revenue includes amounts generated from colocation services provided to customers like DXC.
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The amount being disputed is around $14.8 million over a four-year period from April 1, 2021, to March 31, 2025.
The affected occupancy is approximately 0.4% of Keppel DC REIT’s total attributable lettable area as at Dec 31, 2021.
The impact arising from the disputed sum per annum is approximately 2.0% of Keppel DC REIT’s distributable income for the financial year ended Dec 31, 2021.
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The dispute is said to not have a material impact on the REIT’s overall financial performance.
The manager adds that despite various commercial discussions and mediation between itself, Keppel DC Singapore 1 and DXC, the parties have not been able to arrive at a mutually acceptable resolution.
Further updates will be provided.
Units in Keppel DC REIT closed 2 cents higher or 0.89% up at $2.28 on March 21.
Photo: TES
