Mapletree Industrial Trust (MINT) has entered into a sale and purchase agreement to acquire 29 data centres in the US for a purchase consideration of US$1.32 billion ($1.78 billion).
The data centres, located across 18 states, are being purchased from vendor Sila Realty Trust.
Following the acquisition, MINT’s assets under management (AUM) will increase from $6.8 billion as of March 31 to $8.6 billion. Its portfolio exposure to data centres will increase to 53.6% or $4.6 billion, from 41.2% or $2.8 billion as at March 31.
According to MINT’s press release on May 20, post-acquisition, MINT would be one of the largest owners of data centres among REITs listed in Asia Pacific by AUM.
The new portfolio of assets are predominantly sited on freehold land, encompassing a total net lettable area of 3.3 million square feet. The portfolio currently has an occupancy of 87.8%, with a weighted average lease to expiry of 7.9 years.
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1.7% of the portfolio’s leases expire within the next three financial years, while about 89.4% of the leases have annual rental escalations from 1.5% to 3.%. They are primarily on triple net leases with all outgoings borne by the tenants.
The total acquisition outlay is approximately US$1.35 billion ($1.82 billion), which the manager of MINT says will be financed via proceeds from an equity fundraising and debt.
As one of the 29 properties is encumbered by the tenant’s purchase rights, the final aggregate purchase consideration payable to the vendor will be reduced according to a pre-agreed amount allocated to the property if the existing tenant has exercised the purchase rights.
To that end, the final purchase consideration payable to the vendor will be reduced according to a pre-agreed amount allocated to the encumbered property.
The acquisition is expected to complete in the third quarter of 2021.
Tham Kuo Wei, CEO of the manager, says the acquisition enables the REIT to scale up its data centre presence significantly while diversifying across key markets in the US, including Chicago, Los Angeles and Houston. “[It] marks a significant milestone in our expanded investment strategy since 2017 to include data centres beyond Singapore,” he says.
Units in MINT closed flat at $2.76 on May 19 before trading was halted this morning.
