Iggy's Journal: A S$1.39 Billion Deal That Fixes Almost Nothing

13 September 2026, PM

Video Release

New video's up on Keppel DC REIT, and this one's worth reading past the headline. A S$1.39 billion Tokyo data centre acquisition is being framed as portfolio strengthening, and on paper it should be. Pro forma occupancy only moves from 92.5% to 92.9%, a tiny fix for that much capital deployed. Gearing jumps from a clean 34.0% into the 38-39% band, well outside the range I look for. And the Cardiff vacancy that pulled occupancy below the 95% floor I track is still sitting there, unaddressed by this deal.

That's the trade I want people to actually see. A 0.4 percentage point occupancy improvement bought with a meaningful jump in leverage. One of the thresholds I track was already not met before this acquisition. Now there are two.

My Personal Take

Genuinely, my first read on a S$1.39 billion deal was to assume it was solving something real, that's usually the point of a deal this size. Then I looked at what the occupancy number actually moved by and had to sit with the gap between the framing and the math. This isn't me saying the underlying business is broken, data centre demand in Japan is a real structural story and I'm not dismissing it. But if you're holding this for CPF or SRS income, the question isn't whether the growth story is real, it's whether the balance sheet can absorb it while a known vacancy problem still hasn't been fixed. Worth the watch before you read this acquisition as good news without checking what it cost to get there.

📺 YouTube: https://youtu.be/JuyGF4UYVnE

📩 Substack: https://investingiguana.com/p/japans-grid-constraints-are-reshaping

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Not financial advice. Iggy's Forensic Compliance Standards apply.

Cheers, Iggy 🦖