Keppel DC REIT Rights Issue 2025: Complete Guide for Unitholders

Keppel DC REIT (SGX: AJBU) launched a pro-rata preferential offering in September 2025 to fund the acquisition of Tokyo Data Centre 3 (Tokyo DC3) — a freehold hyperscale facility in Inzai City, Greater Tokyo. This guide covers the full rights issue mechanics, DPU impact, portfolio changes and what every unitholder should know in 2026. This is not financial advice.

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What Was the Keppel DC REIT Rights Issue?

In September 2025, Keppel DC REIT announced a pro-rata non-renounceable preferential offering — commonly called a rights issue — to part-fund the acquisition of Tokyo Data Centre 3 (Tokyo DC3). This was one of the largest equity fundraises in the REIT’s history, raising gross proceeds of approximately S$404.5 million.

A non-renounceable rights issue means unitholders cannot sell their rights on the open market — you either subscribe or let them lapse. This structure was chosen to keep the transaction clean and execution risk low for a large acquisition.

The rights issue was completed in October 2025, with new units listed on SGX on 22 October 2025. The acquisition of Tokyo DC3 was subsequently completed on 19 November 2025, adding a freehold hyperscale data centre in Greater Tokyo to the portfolio.

Tokyo Data Centre 3: The Acquisition That Triggered the Rights Issue

Tokyo DC3 is a newly built hyperscale data centre located in Inzai City, Greater Tokyo. Keppel DC REIT acquired a 98.47% effective interest (the remaining 1.53% is held by Keppel Corporation) for JPY 82.1 billion (~S$707 million).

The asset was developed by a joint venture involving Colt Data Centre Services, Fidelity Investments (Colt’s US parent) and Japanese finance group Mitsui — a strong institutional pedigree. It is a freehold asset, meaning no land tenure risk, which is premium in the data centre space.

Tokyo DC3 is immediately accretive to DPU. The manager estimated a 2.8% pro-forma uplift in annualised DPU if the acquisition had been in place from 1 January 2024, lifting DPU from 9.451¢ to an estimated 9.712¢ on a pro-forma basis.

Beyond the acquisition itself, the rights issue proceeds also funded two domestic AEI (Asset Enhancement Initiative) projects: ~S$53.9 million for Keppel DC Singapore 8 enhancements, and ~S$10.7 million for a 30-year land lease extension at Keppel DC Singapore 1 — important for extending asset life.

Rights Issue Terms & Mechanics

Here are the key terms of the Keppel DC REIT preferential offering:

Source: Keppel DC REIT preferential offering announcement, September 2025.

DPU Impact & FY2025 Results

Despite the enlarged unit base from the rights issue, Keppel DC REIT’s FY2025 DPU rose 9.8% year-on-year to 10.381 cents per unit — the strongest DPU growth since IPO. This was driven primarily by contributions from Keppel DC Singapore 7 and 8, and from Tokyo Data Centre 1 and 3.

FY2025 distributable income surged 55% to approximately S$268 million, while gross revenue rose 42.2% YoY to S$441.4 million. The dramatic revenue growth reflects the transformational scale of acquisitions made in 2024–2025.

Notably, the manager set aside reserves for capital expenditure and under-letting provisions (ULP) — a prudent move that moderates current distributions in exchange for longer-term portfolio resilience. Even with these reserves, DPU grew nearly 10%.

Key FY2025 balance sheet metrics: aggregate leverage stands at 35.3%, providing S$531 million of headroom to the 40% internal cap. Total borrowings of S$2.4 billion are well-managed, with 71.2% hedged through interest rate swaps — meaningful protection if rates stay elevated.

Keppel DC REIT DPU History (FY2020–FY2025)

The chart below shows Keppel DC REIT’s annual DPU from FY2020 to FY2025 — a period that includes a temporary DPU dip in FY2022–2023 due to rising interest costs, followed by a strong recovery in FY2024 and the record FY2025 print.

Source: Keppel DC REIT annual results. Paid semi-annually (1H + 2H).

Portfolio Overview: 25 Data Centres, S$6.2B AUM

As at 31 December 2025, Keppel DC REIT’s portfolio comprises 25 data centres across 10 countries: Singapore, Australia, China, Japan, Malaysia, Germany, Ireland, Italy, the Netherlands and the UK. Portfolio value stands at approximately S$6.2 billion — a significant scale-up from the ~S$4.3 billion pre-2024.

Portfolio occupancy remains resilient at 95.8% (as at December 2025), underpinned by the mission-critical nature of data centre assets and long-term leases. The weighted average lease expiry (WALE) is 6.7 years — providing strong income visibility.

The data centre sub-sector is one of the most structurally favoured in global real estate, driven by AI infrastructure demand, cloud computing expansion and the growth of hyperscaler deployments by the likes of Google, Microsoft and Amazon. Singapore remains a key data centre hub in Southeast Asia, subject to government-regulated capacity growth.

For Singapore investors looking to gain data centre exposure within an S-REIT wrapper (eligible for CPF and SRS investment), Keppel DC REIT remains the primary listed option on SGX. You can calculate your potential dividend income using the S-REIT Dividend Yield Calculator.

Keppel DC REIT Yield vs Industrial REIT Peers (May 2026)

At a share price of approximately S$2.29 (May 2026), Keppel DC REIT’s trailing yield based on FY2025 DPU of 10.381¢ is ~4.5%. This is the lowest among its Singapore industrial REIT peers — but the yield premium from data centres comes through structural growth and capital appreciation potential rather than pure income.

Compared to industrial peers like AIMS APAC REIT (~6.7%), Mapletree Logistics Trust (~6.3%) and Mapletree Industrial Trust (~6.1%), Keppel DC REIT trades at a significant yield discount — reflecting its premium positioning in the data centre niche and stronger DPU growth trajectory.

For investors focused on yield maximisation, see our Best S-REITs Singapore 2026 comparison and the S-REIT Yield vs SGS Bond Spread Calculator to assess relative value. You can also benchmark Keppel DC REIT’s gearing using the S-REIT Gearing Ratio Calculator.

Should You Subscribe / Hold Keppel DC REIT in 2026?

The rights issue is now closed (October 2025), so the decision for existing unitholders is whether to hold or add at current prices. Here’s a balanced view:

Bull case: FY2025 DPU growth of 9.8% with an enlarged unit base demonstrates genuine earnings accretion from the Tokyo DC3 acquisition. Data centre demand from AI infrastructure is structural and multi-year. With 35.3% gearing and S$531M headroom, the balance sheet is not stretched. Analyst consensus target price of ~S$2.62 implies ~14% upside from current levels.

Bear case: At ~4.5% yield, Keppel DC REIT offers a thin margin over Singapore’s risk-free rate (T-bills at ~3.4%). The 2025 DPU of 10.38¢ was boosted by acquisitions — organic growth needs to be proven. The non-renounceable nature of past offerings means existing unitholders who didn’t subscribe faced dilution.

Bottom line: Keppel DC REIT suits investors seeking structural digital infrastructure exposure within a Singapore-regulated REIT structure, willing to accept a lower yield in exchange for thematic tailwinds. It is less suitable for income-maximising investors who prioritise current yield above growth. Always consult a licensed financial adviser before investing.

If you’re building a broader dividend portfolio, explore our S-REIT Outlook 2026 and consider using Endowus or Syfe for low-cost REIT ETF access.

How to Invest in Keppel DC REIT in Singapore

Keppel DC REIT (SGX: AJBU) is listed on the Singapore Exchange and can be purchased through any Singapore-regulated brokerage. It is eligible for CPF Investment Scheme (CPFIS-OA) and Supplementary Retirement Scheme (SRS) investments.

For regular dividend investors, consider dollar-cost averaging into AJBU using a low-fee platform. Our referral partners offer competitive fees and cashback bonuses for new sign-ups:

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