Technology Correspondent
The rapid growth and investment in data centre infrastructure is not an area of business that real estate investment trusts (Reits) can participate in as a typical commercial landlord.
Redefine COO Leon Kok told Business Day that as data centre companies tend to own and operate their facilities, the opportunity for Reits is mainly confined to selling land for development.
Data centres — typically specialised facilities that manage IT infrastructure, including servers, storage devices and network equipment — and related digital structures have become attractive investment targets for asset managers. The businesses are generally backed by long-term customer contracts, ensuring stable, predictable revenue and cash flow.
“We certainly have seen an increase in demand from data centres for space. However, our experience is that the operators typically prefer to own their sites, given the large technology investment within the building,” said Kok.
