CPPIB commits $500m to Singapore-based ADCF

CPPIB’s investment comprises an initial allocation of $350 million with the option to invest a further $150 million, according to a release. The commitment is expected to bring the total fund size to $1 billion upon successful closing, doubling the initial target of $500 million.

ADCF launched last year alongside property-focused vehicle Alpha Asia Macro Trends III, which has a target of $1 billion. Both funds are managed by Keppel Capital, Keppel’s asset management arm, and have reported a first close as of last July: ADCF with $130 million, and the property vehicle at $280 million.

ADCF aims to develop a portfolio of greenfield and brownfield data center assets across Asia Pacific and Europe, and when fully invested is expected to have assets under management of up to $2.3 billion. It intends to leverage the Keppel Group’s industry relationships and expertise to develop reliable, energy-efficient facilities.

Investments from the fund so far include a 60% stake in Germany-based Keppel DC Frankfurt 1 acquired last December and a 70% stake in Keppel DC Singapore 4 bought earlier this year.

“The continued strong growth in data requirements globally has driven demand for quality data center space, particularly in the Asia-Pacific region where digital infrastructure is relatively under-developed,” said Jimmy Phua, managing director and head of real estate investments for Asia at CPPIB. “By investing alongside the Alpha Data Centre Fund, CPPIB is able to gain exposure into this critical sector, in partnership with the Keppel Group, a well-respected partner.”

With the expansion of internet services and cloud storage worldwide, companies are increasingly looking to outsource their data center requirements, and PE investors are looking for ways to participate in the growth story. Activity in Asia includes Warburg Pincus’ development of data center-focused platforms focused on China specifically and emerging markets more broadly, and Goldman Sachs’ investment with TPG in Singapore-based AirTrunk’s regional expansion plans.

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