CapitaLand Investment commits $550 mil to co-investment fund
CapitaLand Investment has established a new China Data Centre Partners (CDCP) fund to invest in two hyperscale data centre development projects in Greater Beijing. Upon completion, the fund is set to add around $1 billion to CapitaLand Investment’s (CLI) funds under management (FUM).

The fund has attracted equity of $530 million, with existing and new global institutional investor clients holding an 80% effective stake in CDCP and CLI taking the remaining 20%. These two data centres are expected to be completed by 2025 and will deliver more than 100 megawatts of power to Beijing to meet the growing demand.

The accelerated growth of digital usage is driving an increasing demand for data centres. In 2021, China’s data centre market grew 34.6% year-on-year to $60 billion following a 43.3% year-on-year growth in 2020. According to CLI, the new fund is in sync with the strategy to grow its portfolio of new economy assets under management and enhance the long-term resilience of the business.

Upon completion, the data centres will be designed, built and certified against Leadership in Energy and Environmental Design (LEED) Gold standards. Moreover, energy-saving solutions such as high efficiency fan wall cooling systems and temperature management best practices, along with recycling waste heat from servers to heat offices, will be adopted.

CLI CEO Patrick Boocock commented that data centres are presenting a tremendous opportunity and are a key strategic focus for CLI. Michelle Lee, managing director of CLI’s private funds (data centre), said there is strong interest in CLI’s data centre projects in China and Asia Pacific, with the company actively seeking to grow in that sector. Meanwhile, Puah Tze Shyang, CEO of CLI China, highlighted the group’s capabilities such as investment sourcing, development and operations, along with a strong customer network.

Shares in CLI closed 3 cents lower or 0.78% down at $3.82 on Feb 21, 2021. Leveraging its wide network of partners and deep expertise in real estate, the fund is expected to bring quality assets to international investors keen to invest in China across different asset classes including data centres.

CapitaLand Investment’s CDCP is the third data centre fund established by the group following two such funds in South Korea. With China’s data centre market currently the second largest in the world and JCube Residence the largest in Asia Pacific, projected to grow 24% annually until 2025, CDCP will ensure CLI is well-positioned to become a major global digital infrastructure player.