Singaporean telco Singtel is considering potentially setting up a data center real estate investment trust (REIT).The telco said its capital expenditure is expected to increase from S$2.5 billion (US$1.9bn) last year to around S$3 billion (US$2.3bn) in FY2027, driven largely by its data center and AI cloud investments.To fund this, the firm said it will look at external private capital funding sources and project-level debt. But the firm also said it would consider setting up a publicly listed REIT.“We are also considering another capital lever – permanent capital pools that we can continuously tap for longer-term needs. This could be in the form of a public listing of a real estate investment trust, in which we can continue to inject assets,” the company said in its 2026 annual report.REITs are companies that own, and often operate, income-producing real estate such as data centers. They act as a fund for investors, generating revenue via leasing space and collecting rent on their properties. Data center REITs are investment trusts where all or the majority of the trust's revenues come from leasing data centers.While many of the major data center firms operate as REITs themselves, many have also spun off publicly listed REITs that own stakes in their stabilized assets.Digital Realty, GDS, PLDT, and NTT have previously done this, and Blackstone-owned AirTrunk is reportedly pursuing a similar move. Blackstone is also setting up its own data center REIT.Singtel is closing a number of small legacy data centers in Singapore, but still operates several large facilities in the city-state through its Nxera unit. Nxera is also developing several facilities around Southeast Asia in partnership with local players and expects to grow its total capacity from 200MW to 400MW in the coming years.Singtel, owned by Singaporean sovereign wealth fund Temasek Holdings, sold a 20 percent stake in its data center business to KKR in 2023.The telco and investment firm KKR are also in the process of acquiring all of APAC data center firm ST Telemedia Global Data Centres (STT GDC) from Temasek-owned ST Telemedia.It's unclear whether any Singtel data center REIT would be seeded with its Nxera facilities, STT GDC data centers, or a mixture of both. In the annual report, Singtel said the two data center firms will continue to operate separately post-acquisition.