Data center operator AirTrunk is delaying a planned initial public offering of a real estate investment trust in Singapore until next year, as higher interest rates and market volatility temper investor demand, according to people familiar with the matter. The Blackstone Inc.-backed company had been planning to begin formally gauging investor interest for the $1.5 billion REIT IPO at the start of October.
The move follows a collapsed IPO in Australia by another data center company, Firmus Grid Ltd., which failed to attract enough demand at its target valuation. The setback reflects growing investor caution toward artificial intelligence infrastructure deals that depend on future earnings. To make its offering more attractive, AirTrunk had considered a roughly 6% yield, up from a previously envisaged 5.5%. However, the US interest rate rise in September and the prospect of further increases have kept investors wary, since REITs are sensitive to borrowing costs.
The data center subsidiary of Philippine telecommunications firm PLDT Inc. also said it would defer its REIT IPO to next year. Singapore's main REIT Index has fallen 12% since late July. AirTrunk is still deliberating over details such as the size and timing of the potential listing. Representatives for AirTrunk did not respond to requests for comment, and Blackstone declined to comment.
Founded in Sydney in 2015, AirTrunk operates data centers in Australia, Hong Kong, India, Japan, Malaysia and Singapore. In 2024, Blackstone and Canada Pension Plan Investment Board acquired the company for A$24 billion ($16.7 billion), Blackstone's biggest-ever investment in the Asia Pacific region.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing