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MAPLETREE Logistics Trust is selling a light industrial property at 20 Tampines Street 92 for S$20 million to a data centre joint venture formed by two Keppel units, according to Singapore Exchange filings on Thursday.
Keppel Data Centres Holding, owned 70-30 by Keppel Telecommunications & Transportation and Keppel Land, said in a filing that it plans to develop the property into its fourth data centre in Singapore.
The property consists of two blocks of light industrial buildings with ancillary office space. It has a gross floor area of approximately 9,251 square metres on a land site of approximately 6,804 square metres.
Mapletree Logistics Trust said in its statement that the average age of the two buildings was 19 years, adding that the buildings were "designed with specifications that are no longer able to meet today's modern warehousing requirements".
"As the site is small with limited potential to redevelop into a modern specifications warehouse, we would prefer to recycle the capital released from its divestment into better quality and higher yielding logistics assets," said the trust manager's chief executive officer, Ng Kiat.
On its part, Keppel T&T said that its proposed greenfield data centre development would be strategically located near existing data centres that Keppel Data Centres operates at Tampines, which are Keppel Datahub 1 and Keppel Datahub 2.
When completed, the proposed fourth data centre will have about 183,000 square feet of gross floor area, making it Keppel's second-largest data centre in Singapore after Keppel Digihub, Keppel T&T said.
Keppel T&T CEO Thomas Pang said in a statement: "Data centre utilisation rates in Singapore have been consistently high, reflecting the country's status as a data centre hub in the region. This demand is expected to grow, led by the outsourced data centre requirements of multinational companies, banks and financial institutions."