SMM News: among the 160 REITs with a market capitalization of more than S $3 billion in the world as of June 23, 2020, three data center-related REITs ranked among the top 20 performers, namely: Keppel data Center Real Estate Trust, Mapletree Industrial Trust and take-off Real Estate Investment Trust. The average total return of the three REITs was 14 per cent, with an average total return of 45 per cent in 2019.
As of June 23, 2020, data center-focused stocks have been one of the most defensive sectors in the global stock market. Since the data center was incorporated into the FTSE NAREIT US real estate index series (FTSE NAREIT US Real Estate Index Series), and became one of the REIT branches in December 2015, data centers and related proprietary properties, including data storage, cloud resources and connected properties, have gradually become mainstream asset classes.
The Keppel data center real estate trust, which has had the strongest performance in the S-REIT sector so far in 2019 and early 2020, was included in the stock list of the sea index in March this year, with a total return of 22% so far this year, making it the most valuable stock among the five major components of the stock index reserve list.
In the global blockade environment, enterprises either speed up the digital transformation, or expand the degree of online business and virtualization. During the New Crown pneumonia outbreak, data centers were seen as essential infrastructure around the world, and REIT managers reported strong demand for data centers from cloud service providers.
The market capitalization of the Keppel data center real estate trust is S $4.11 billion, slightly higher than that of Xinda Trust (S $4.08 billion). At present, Xinda Trust is at the top of the list of sea index reserves, while Mapletree Industrial Trust was previously at the top of the list of sea index reserves.
In its annual report for fiscal year 2019, Keppel data Center Real Estate Trust stressed that Internet companies under the "industry sector" accounted for 48.5 per cent of portfolio rental income. At the annual general meeting of shareholders in fiscal year 2018, Cai Xianyang, CEO of Jibao data Center Real Estate Trust Management Co., Ltd., stressed that the company's policy is not to share tenant names, but to share the "industry" of the trustee customers. This is because the confidentiality of the data center location is very important to the customer. In addition, at its annual general meeting in fiscal 2018, the company's chief executive said its customers included "very large cloud providers, which are currently one of the largest companies in the world, and the risk of default is very low".
Mapletree Industrial Trust is not a pure data center, which currently accounts for 31.6% of its real estate portfolio based on the book value of investment and interest, while its exposure to high-tech buildings (including data centers) is 55.0%.
Since June 22, Mapletree Industrial Trust has been included in the Straits Times Index (STI), and announced private financing, increasing its portfolio exposure to data centers from 31.6% to 39.0% and its extensive exposure to high-tech buildings (including data centers) from 55.0% to 59.9%.
On June 23, Mapletree announced that it had reached an agreement to acquire the remaining 60.0 per cent of 14 data centres in the US, which are currently owned by the Makewood data Center Trust ("MRDCT"). Mapletree Industrial Trust already owns 40.0% of MRDCT and the remaining 60.0% is held by Mapletree DC Ventures, a wholly owned subsidiary of Mapletree Investment.
Tengfei Real Estate Investment Trust points out that high-end industries and data centres account for 17 per cent of its portfolio in terms of the value of investment properties, compared with 20 per cent and 21 per cent in fiscal 2019 and 2018, respectively. In this category, there are currently three major data centers (4.3% of the portfolio), two of which are single-tenant buildings. Of the monthly total income of Tengfei real estate investment trust, ICT customers account for 9.4%, data centers account for 5%, and biomedical science accounts for 11.0%.
As part of its strategic goal of building a flexible and diversified property portfolio, Tengfei Real Estate Investment Trust acquired 28 business park properties (worth about S $1.3 billion) in emerging technology cities such as San Diego, Raleigh and Portland in 2019. It is worth noting that this goal is based on the growing demand of enterprises in the technology and health care sectors.
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