STARTING A JOINT VENTURE ON THREE FACILITIES
Famous Digital Realty has entered into definitive agreements with affiliates of Mapletree Investments and Mapletree Industrial Trust to sell a portfolio of ten Powered-Base Building data centers.
The agreements also include the establishment of an 80/20 joint venture on three existing hyperscale data centers in Ashburn, Virginia.
In total, both transactions will generate approximately $1.4 billion in proceeds for Digital Realty upon closing.
According to Digital Realty, proceeds from the sale of its 10 North American data centers and that of the joint venture will initially be used to pay down debt and ultimately to fund future investment activity.
“These transactions represent an important step towards our goal of self-funding our growth and diversifying our sources of equity capital while shrinking our asset base and setting the stage for accelerating growth as the proceeds are redeployed into accretive investment opportunities,” said A. William Stein, CEO, Digital Realty.
“We are pleased to partner with the high-caliber team at Mapletree to effect a transaction that meets both companies’ objectives, and we look forward to collaborating with Mapletree as joint venture partners and exploring additional opportunities together worldwide.”
Singapore-based Mapletree Investments and Mapletree Industrial Trust will acquire the Powered-Base Building portfolio from Digital Realty for a total purchase price of $557 million. Also, the 80% stake to be acquired from the joint assets will cost Mapletree approximately $811 million.
“We have deepened our presence in the fast-growing data center sector with our second portfolio acquisition in North America,” said Hiew Yoon Khong, Group Chief Executive Officer of Mapletree Investments.
“These transactions add high-quality properties in key data center markets underpinned by global cloud and colocation players. Our strategic collaboration with a leading global provider of data center solutions like Digital Realty will enable us to scale up meaningfully in developed economies for this resilient asset class.”
The transactions are set to close in late 2019 or early 2020 and are subject to customary closing conditions.