As a result, the REIT is expected to enjoy an estimated increase of $1.5 million in rental income in the first year alone, translating to a 1.5% upside to distributable income for FY2025 to FY2026.
Dale Lai of DBS Group Research has kept his "buy" call and US$1.20 target price on NTT DC REIT after the lease renewal of one of its data centres, SG1, at a higher rate, "marking a highly positive development".
While the contracted capacity has been modestly reduced by around 10%, from 3.0MW to 2.7MW, this has been more than offset by a significant uplift in rental rates, up by "an impressive" 23% to $474 per kW.
