EL7.AI
StocksMediumUpdated×2•Originally published 23 October 2026•Updated 23 October 2026•
4 min read

Keppel DC REIT Distributions Rise 11.7% as Income Grows and Portfolio Expands

Key Facts

1Distribution per unit rose 11.7% to 8.571 Singapore cents in the first nine months of 2026, from 7.670 cents in the corresponding period.
2Distributable income increased 16.7% to 227,996 thousand Singapore dollars, from 195,301 thousand Singapore dollars.
3Financing costs rose 28.1% to 46,693 thousand Singapore dollars, from 36,444 thousand Singapore dollars.
4Aggregate leverage stood at 36.2% at the end of September, following a partial drawdown of yen loans to fund the Japanese acquisition.
5Assets under management reach about 7.6 billion Singapore dollars after the acquisition, spread across 27 data centres in 10 countries.

Distribution per unit at data centre trust Keppel DC REIT rose 11.7% in the first nine months of 2026, according to its operational update, as distributable income grew at a faster pace. Distribution per unit reached 8.571 Singapore cents for the period ended September. That compares with 7.670 Singapore cents per unit in the corresponding nine months of 2025. The REIT reported distributable income of 227,996 thousand Singapore dollars for the reporting period. Distributable income stood at 195,301 thousand Singapore dollars in the same period a year earlier. This represented a year-on-year increase of 16.7%, outpacing growth in the amount distributed per unit.

On the operational front, the REIT's gross revenue reached 365,298 thousand Singapore dollars in the first nine months of the year, according to its operational update presentation. Revenue rose 13.3% from 322,440 thousand Singapore dollars in the corresponding period of 2025. Net property income increased to 316,794 thousand Singapore dollars from 280,213 thousand Singapore dollars a year earlier. Net property income grew 13.1% year on year, broadly matching gross revenue growth over the same period. The REIT attributed growth in net property income to "rental increases upon renewal and contractual escalations", reflecting the contribution of lease terms to improved operating income. In the third quarter alone, positive rental reversion on renewed and commencing leases was about 16%, according to the update.

Growth in operating activity coincided with an increase in financing costs to 46,693 thousand Singapore dollars in the first nine months of 2026, according to the REIT. Those costs stood at 36,444 thousand Singapore dollars in the corresponding period a year earlier, marking an increase of 28.1%, faster than growth in revenue and net property income. On the balance sheet, aggregate leverage reached 36.2% as of 30 September, following a partial drawdown of yen-denominated loans to fund the Japanese acquisition. Fixed-rate debt accounted for 69.6% of the REIT's total debt at the end of the same month, according to the operational update. Alongside borrowing, the REIT raised 625 million Singapore dollars through a private placement in September. The REIT used the placement proceeds to fund part of the Japanese acquisition, which was thus financed through the placement and loans.

Providing details of the Japanese expansion, Keppel said in its September acquisition announcement that the consideration payable by the REIT was about 168.4 billion Japanese yen. That is equivalent to about 1,372.3 million Singapore dollars, based on the approximate value cited in the transaction announcement. The company said the two Japanese assets were 100% occupied and leased to 4 investment-grade customers. Including the two assets, whose acquisition was completed in October, portfolio occupancy stands at 93.4%, measured by the lettable area of the end-September portfolio after adding the acquisition. Also including the acquisition, contracted revenue-generating capacity rises to about 97%, according to the October operational update. The two assets join the portfolio fully occupied and with contracts with investment-grade customers, according to Keppel's statement.

The acquisition brings the REIT's assets under management to about 7.6 billion Singapore dollars, according to estimates in the September transaction announcement. With the addition of the two assets, the portfolio comprises 27 data centres across 10 countries, expanding the REIT's asset footprint. Singapore retains the largest share of rental income, with the transaction announcement projecting that it would contribute about 60% of portfolio rental income after the acquisition. At the two Japanese assets, management estimated that existing rents were "at least 30% below prevailing market rents". Their leases also include contractual annual escalations averaging about 2.8%, according to the acquisition announcement. The acquisition, completed in October, falls within the final quarter of the REIT's financial year, which ends on 31 December 2026, according to its financial calendar.