Singapore’s asset manager and operator Keppel Ltd. has secured close to S$2 billion ($1.53 billion) of capital commitments from global institutional investors for its Keppel Data Center Fund III (KDCF III), Keppel Education Asset Fund II (KEAF II) and Sustainable Urban Renewal (SUR) strategy, representing approximately S$4.9 billion ($3.74 billion) in Funds under Management (FUM).

Keppel said in a statement on Monday that Keppel’s third data center fund, KDCF III, has achieved its first close, raising approximately $580 million in initial capital commitments from various global institutional investors.

KDCF III will draw on Keppel’s deep expertise in developing and operating data centers to invest in a portfolio of sustainable, best-in-class data centers in the Asia Pacific region.

KDCF III will focus on securing pre-commitment or high leasing certainty from hyperscale customers, which would mitigate portfolio leasing risk for investors.

As part of Keppel’s integrated ecosystem, KDCF III will benefit from synergies across Keppel’s operating divisions, such as the sourcing of renewable energy and advanced cooling infrastructure, which are increasingly important to hyper scalers.

KDCF III will also be able to tap on Keppel’s strong customer relationships with hyper scalers to access off-market opportunities, as well as Keppel’s proprietary assets.

Keppel has achieved the first close of KEAF II with approximately $307 million in committed capital.

KEAF II has secured capital commitments from a returning sovereign wealth fund invested in KEAF I, as well as commitments from new LPs from the insurance, pension and endowment sectors.

The Keppel Education Asset Fund series focuses on strategic value-add investments in education-related assets and facilities, supporting early learning, K-12, higher education, tertiary education and student accommodation, with a focus on the Asia Pacific region.

“The securing of about S$2.0 billion in capital across Keppel’s flagship funds reflects the resilient demand for high-quality alternative real assets anchored to macrotrends such as climate change and energy transition, urbanization as well as rapid digitalization and the AI wave,

“This significant milestone brings us closer to our interim FUM target of S$100 billion ($76.29 billion) by 2026, with ambitions to reach S$200 billion ($152.58 billion) by 2030,” said Christina Tan, Chief Executive Officer of Fund Management and Chief Investment Officer, Keppel.

“Notwithstanding the current volatile international environment, Keppel is well-positioned to offer both critical solutions that the world needs, and defensive investment products that can help to steady investors’ portfolios,

“We are committed to delivering strong returns to our Limited Partners leveraging Keppel’s deep operating capabilities in sustainability and connectivity solutions,” she added.

Keppel has raised S$760 million ($579.82 million) for its SUR strategy, bringing the strategy’s cumulative FUM to approximately S$4.3 billion to date[2]. This includes the latest commitment from one of Europe’s largest pension funds, underscoring investors’ continued focus on quality sustainable urban renewal assets.

The SUR strategy will invest in value-add real estate opportunities with the goal of decarbonizing the built environment, while delivering attractive risk-adjusted returns to LPs. The strategy is currently pursuing a pipeline of investment opportunities across real estate segments[3] including commercial, living, life sciences, hospitality and logistics in Singapore, South Korea, Japan, Australia and first-tier cities in China.

The above-mentioned developments are not expected to have any material impact on the earnings per share and net tangible assets per share of Keppel Ltd. for the current financial year.

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