Mapletree Industrial Trust Buying 29 US Data Centres From Sila Realty for $1.3B

Singapore’s Mapletree Industrial Trust is set to add to its collection of US data centres after entering an agreement to acquire 29 facilities across 18 states for $1.3 billion.

The assets represent the entirety of the data centre portfolio of the seller, Florida-based Sila Realty Trust, and include properties in key markets like Los Angeles, Chicago, Houston and Atlanta.

Post-acquisition, MIT will have a presence in 13 of the top 15 data centre markets in North America, with these markets accounting for 64.2 percent of North American data centres by gross rental income, the trust’s manager said Thursday in a release.

“This portfolio acquisition will enable us to scale up our data centre presence significantly and diversify our footprint across key markets in the United States,” said Tham Kuo Wei, chief executive of the trust’s manager. “Data centres remain resilient with attractive growth opportunities, which are underpinned by the acceleration of digitalisation, cloud adoption and e-commerce during the pandemic.”

Tampa, Florida-based Sila is selling its data centre portfolio in a strategic shift to focus exclusively on healthcare properties, the comapany said in a statement.

Coming to America

As of March, MIT’s assets under management totalled S$6.8 billion ($5.1 billion), including 13 US data centres held through a joint venture with Mapletree Investments, the Temasek Holdings-backed developer and fund manager that controls the trust’s manager.

The joint venture’s North American data centre acquisitions have included the $1.4 billion purchase of 13 assets from Digital Realty in 2019 and the $750 million purchase of 14 assets from Carter Validus Mission Critical REIT in 2017. MIT later bought out Mapletree’s 60 percent interest in 14 assets.

Beyond deepening MIT’s position in data centres, Tham said the proposed acquisition of the Sila portfolio marks a significant milestone in the trust’s expansion beyond Singapore, where the trust has 87 properties.

“This is in line with our strategic efforts to reshape the portfolio toward higher value uses,” he said. “Data centres will increase to 53.6 percent of MIT’s assets under management from 41.2 percent as at 31 March 2021.”

Sila Exits Bit Barns

No information about power capacity was disclosed, but the total net lettable area of the Sila portfolio is 3.3 million square feet (306,580 square metres). The portfolio has an occupancy rate of 87.8 percent with 32 tenants.

Sila Realty Trust is a public, non-traded REIT that invests in healthcare properties and data centres. The company owns 153 properties, including 124 healthcare facilities and the 29 data centres to be disposed of as the REIT’s focus shifts to healthcare.

“We are pleased to enter into this agreement with MIT to sell our data centre properties,” said Sila president and CEO Michael Seton. “This action marks another key step in Sila Realty Trust’s evolution to provide a clear path for the company to pursue a strategy as a pure-play healthcare REIT.”

The transaction is expected to be completed in one or more closings during the third quarter of 2021, Sila said.