New IPO launch . Price offered at US1.00. Applications start from 7-10 July 2025.
Estimating dpu yield of about 7.5%.
Not a call to buy or subscribe!
Pls dyodd. Quote:
NTT DC REIT is different from other S-REITs with US assets, says manager’s CEO and CFO
NTT DC REIT is the first REIT IPO since December 2021 when Digital Core REIT was listed.
The forecast annualised distribution per unit (DPU) in FY2026 (NTT DC REIT has a March year end) is projected at 7.5 US cents, and the DPU in FY2027 is estimated to be 7.8 US cents translating into forward yields of 7.5% and 7.8% in FY2026 and FY2027 based on the IPO price of US$1 to cornerstone investors and institutional investors for the placement tranche. The retail tranche for local investors is priced at $1.276.
The IPO Portfolio has an appraised value of US$1,572.8 million with a design IT load of approximately 90.7 megawatts (MW). Based on the prospectus, 53.9% of the portfolio valuation is based in California, 13.5% in Northern Virginia, 16.5% in SIngapore, and 16.1% in Vienna. Of the total IT load of 90.7 MW, 66.7 MW is in the US.
Hyperscale customers, comprising global cloud service providers and major international tech giants, make up 51% of the IPO Portfolio’s total monthly base rent as at 31 December 2024. An extensive list of colocation customers across a broad range of industries contributes to the remaining 49%.
.As at Dec 31 2024, the occupancy of the IPO Portfolio stood at 94.3%, with a weighted average lease expiry of 4.8 years. The IPO Portfolio has a well-balanced lease expiry profile with no single financial year seeing lease expiries in excess of 20% of monthly base rent in the next five financial years.
The average retention rate over the last three years was 98.3%. However in May this year, one of the customers of the IPO Portfolio which has a contracted capacity of 8,000 KW in Northern Virginia (VA2) and 638 KW in California (at CA1) served a notice of termination in relation to its contracted
capacity at CA1 with an effective date of Sept 30. This would cause occupancy to decline to 93.6%. The tenant was acquired by NTT DC REIT’s third largest tenant.
It is possible that the third largest tenant (including NTT) is Microsoft as it is AAA-rated by the ratings agencies.
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