ESR Cayman and ARA Asset Management's Logos are launching two complementary funds to raise up to $2.5 billion to fund the enlarged group's expansion into the booming data centre space across Asia Pacific, with the goal of replicating their success as the region's largest landlord for e-commerce giants.
The first close for the data centre development funds is projected to be completed by the first half of 2022, according to ESR chairman Jeffrey Perlman in a recent interview with Forbes Asia. ESR is in the process of combining with Singapore's ARA Asset Management.130 billion dollars In October, the businesses announced a second transaction to consolidate their Singapore-listed subsidiaries ESR REIT and ARA Logos Logistics Trust. Both deals are scheduled to close in the first quarter of 2022.
The combination will create the Asia Pacific's largest new economy property platform, with AUM of more than $50 billion, mostly composed of logistics assets. To meet the increased need for digital infrastructure, the company has been expanding into data centres. Amazon, Alibaba, and JD.com are among the company's most important logistical tenants.day, and all of that data must be saved someplace. Because it is kept in the cloud, data centres are still required."
ESR is building its largest data centre project in Osaka, Japan, which when finished would have a gross asset value (GAV) of more than $2 billion. In Hong Kong, the business is also converting an industrial facility purchased from the family of late entrepreneur Tang Shing Bor in May into a data centre with a GAV of $675 million once completion.Data centres, according to ESR. Perlman, may potentially account for up to 15% of the group's new economy property portfolio, which also includes contemporary warehouses for e-commerce enterprises and cold storage facilities for cloud kitchens.
The fast expansion of e-commerce, video conferencing, and other digital platforms is driving the expansion of data centres throughout Asia Pacific. According to a survey released in August by Research and Markets, the market for data centres is predicted to more than double to almost $60 billion by 2027, up from $26 billion in 2020.Straits Trading by Chew Gek Khim.
Among the largest investors in the merged ESR and ARA organisation are Warburg Pincus in the United States and Oxford Properties in Canada. ESR founders Jeffrey Shen and Stuart Gibson, ARA cofounder John Lim, and Singapore millionaire Lee Kuan Yew are among those who have contributed.
According to the group, with these projects, it may create data centres with a total server capacity of around 250 megawatts and a GAV of more than $10 billion across Asia Pacific in the next years.
"The epidemic has just fueled the rapid expansion of e-commerce," Perlman argues. "Our daily lives are undergoing digital revolution." We use Zoom and Teams on a daily basis.
In August, ESR announced the acquisition of ARA for $5.2 billion, creating Asia Pacific's largest real estate asset manager with over $5.2 billion in assets under management.of more than $2 billion when completed. In Hong Kong, the company is also redeveloping an industrial asset it bought in May from the family of the late tycoon Tang Shing Bor into a data center, which will have a GAV of $675 million upon completion.of more than $2 billion when completed. In Hong Kong, the company is also redeveloping an industrial asset it bought in May from the family of the late tycoon Tang Shing Bor into a data center, which will have a GAV of $675 million upon completion.of more than $2 billion when completed. In Hong Kong, the company is also redeveloping an industrial asset it bought in May from the family of the late tycoon Tang Shing Bor into a data center, which will have a GAV of $675 million upon completion.of more than $2 billion when completed. In Hong Kong, the company is also redeveloping an industrial asset it bought in May from the family of the late tycoon Tang Shing Bor into a data center, which will have a GAV of $675 million upon completion.
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