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Digico Infrastructure REIT (ASX:DGT) has announced its execution of a deal leasing 71MW of power to “a global technology firm with investment grade credit support” from its SYD1 data centre, bringing SYD1 to 100% contracted.
There was no word from DigiCo on Thursday about who, exactly, is the customer that’s just picked up 71MW of power across 15 years.
Presumably, they’re a high-impact client – DigiCo has re-allocated to today’s customer 20MW of power that was previously allocated to somebody else.
“The 71MW contract includes the reallocation of 20MW of existing contracted capacity to the new customer,” DigiCo wrote on Thursday.
“The new 71MW contract increases the Weighted Average Lease Expiry3 of DigiCo’s Australian portfolio from ~3 years to greater than 10 years.”
Execution of the 71MW contract at SYD1 is a key milestone for DGT, taking the site to 100% contracted across 88MW of total capacity. The 15-year agreement with a global technology firm provides long-term earnings visibility, supported by investment grade credit backing. It validates the quality of our infrastructure and strengthens the quality of cashflows from our portfolio.
When we acquired SYD1, our business plan was to fully lease and develop the site to 88MW over five years, and we now expect to reach that milestone well ahead of our original plan.
SYD1 will be the subject of an expansion in the near future spearheaded by Laing O’Rourke and Shape Australia, with that expansion “expected to be income producing in late Q4 [of] FY27” with results to become truly evident through FY28.
FY27 CapEx is expected to range up to A$500M weighted mainly to the second half. The SYD1 expansion, meanwhile, is fully funded from existing cash and debt as well as proceeds from US asset sales.
The company on Thursday re-affirmed FY27 EBIT guidance of up to $125M.
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