Asian Infrastructure Investment Bank (AIIB) is going to invest $150 million in the development of data centres that mostly serve emerging Asia. This is AIIB’s first data centre project.

Launched in December 2020, Keppel Data Centre Fund II has attracted a diverse group of investors from Asia and Europe. Besides AIIB, the fund also attracted investments from sovereign wealth funds, financial institutions, insurance funds, and pension funds.

Managed by Alpha Investment Partners Limited (Alpha), a private fund manager under Keppel Capital, KDC Fund II will tap Keppel Data Centres Holdings’ (Keppel Data Centres) expertise in developing, operating and maintaining quality data centres to capture investment opportunities in greenfield and brownfield data centre assets.

AIIB’s investment of $100 million through a parallel fund structure and $50 million through co-investments marks the final close of KDCF II. The fund is focussed on strategic investments in the fast-growing data centre sector with a focus on Asia Pacific.

Many low- and mid-income countries lack their own domestic data infrastructure, and this project will enhance capital mobilisation to develop data centres serving emerging Asia.

AIIB will conduct a prior review of investments presenting significant environmental and social (ES) risks like involuntary resettlement, adverse impacts on Indigenous Peoples, environment, community health and safety.

Dongik Lee, director general, Banking Department (Region 1) said, “The digitalisation mega trend is re-shaping global markets and business operations. This trend has been accelerated by the COVID-19 pandemic. AIIB’s Digital Infrastructure Sector Strategy has identified data centres as essential components of the digital ecosystem and attractive investment targets.”

Keppel Capital is the asset management arm of Keppel Corporation, one of Singapore’s flagship multinational companies with a global footprint in more than 20 countries.

Keppel Corporation provides solutions for sustainable urbanisation, focusing on energy & environment, urban development, connectivity, and asset management.

With assets under management of approximately $37 billion as at end-2020, Keppel Capital has a diversified portfolio that includes real estate, infrastructure, and data centre assets in key global markets.

Image credit: Reuters