This article is from the Australian Property Journal archive
DAVID Di Pilla’s HMC Capital has scaled up its digital infrastructure platform with the acquisition of iseek, a leading Australian co-location data centre operator, in a $400 million deal.
The iseek acquisition is valued at 19 times the forecasted EBITDA for CY2025, with a $150 million upfront cash component and $250 million in scrip for the DigiCo REIT IPO. Major stakeholders and founders have agreed to escrow much of their holdings until FY2025 and FY2026.
The portfolio includes seven data centres across in Brisbane, Sydney, Adelaide and Townsville, and boasts 6.1MW of installed IT capacity, contracted capacity of 3.2MW and a pipeline for an additional 33.7MW.
The data centres currently serve over 500 customers national.
This acquisition aligns with HMC’s strategic vision to develop DigiCo, an ASX-listed Infrastructure Real Estate Investment Trust (REIT) targeting digital assets across Australia and North America.
HMC Capital aims to seed DigiCo REIT with $4 billion in assets under management (AUM), including additional data centres in exclusive North American deals totalling $1.6 billion.
The REIT, slated for IPO by year-end, plans to raise $2.6 billion and will deliver a 4% target yield, supported by a robust customer base across government, enterprise, and hyperscale sectors.
Meanwhile digital infrastructure has emerged as the preferred asset class for investors.
The market was capped off by this year’s sale of AirTrunk to Blackstone for $24 billion.
CBRE’s managing director of debt and structured finance, Andrew McCasker, said investment interest in data-centre assets has increased substantially following a rise in data storage requirements, cloud computing and technological advancements.
Darcy Frawley, CBRE Pacific data centres capital markets director, said, “Occupiers are now competing aggressively to increase their data centre footprint to accommodate future business needs.
“Australia is set to see a large gap between capacity and demand in the medium-term, which will lead to significant rental growth and make the sector even more appealing for data centre investors.”
Recently industrial property giant Goodman Group is orienting its development workbook towards data centres as demand moderates in other sectors.
