Keppel has announced that its private fund, Keppel Data Centre Fund II (KDCF II), has entered into a joint venture (JV) with Digital Decarbonization Solutions Platform (DDSP), a digital infrastructure and decarbonised energy delivery company to develop an 80 MW Tier III-equivalent greenfield data centre campus (Taiwan DC Campus) in North Taiwan. KDCF II will hold a 50% interest in the joint venture, with the rest being held by DDSP.
This marks Keppel’s first data centre project in Taiwan and represents a strategic move to ride on the tailwinds of Taiwan’s Artificial Intelligence (AI) and semiconductor boom.
The Taiwan DC Campus will be developed in two phases. Expected to be ready for service in 2026, the first building (Phase 1) of the Taiwan DC Campus has secured a long-term contract with a leading global cloud service provider with capacity available for future expansion. Phase 2 will position Keppel to capture further upside from the opportunities in Taiwan’s growing data centre market.
Christina Tan, CEO of Fund Management and CIO of Keppel, said, “We are excited to enter Taiwan’s flourishing data centre market with an attractive investment at an opportune time amid the boom in the AI and semiconductor sectors. With the potential to scale up to 80MW, the Taiwan DC Campus bolsters our strategy to grow our portfolio of AI-ready hyperscale data centre assets across Asia.
“This investment underscores Keppel’s robust relationships with global cloud providers and highlights our distinctive edge as an asset manager and operator to create strong value through site sourcing, leasing, developing, and operating critical data centre assets. Leveraging our deep expertise, Keppel is well-positioned to seize opportunities in quality digital infrastructure, offering our investors compelling investment solutions with attractive, risk-adjusted returns.”
Frederic Devos, CEO of DDSP said, “We are proud to announce DDSP’s first data centre campus in Taiwan, in partnership with Keppel, a tier 1 partner. This exciting collaboration highlights our shared commitment to decarbonization, and sustainable growth to benefit our customers.
“This campus is the first of several campuses currently under development by DDSP in collaboration with data centre operators, as part of our long-term vision for expansion in the region. Through our partnership with Keppel, we’re scaling operations and contributing to the reduction of the digital economies’ carbon footprint. This facility will drive cloud solutions for our customers, and reinforces Taiwan’s leadership in green energy and digital infrastructure”
In 2023, the Taiwan data centre market clocked high utilisation rates of 94.3%. Future demand and supply are projected to reach an estimated Compound Annual Growth Rate (2023 to 2028) of 10.6% and 10.1%, respectively. Looking ahead, Taiwan’s DC market is expected to be bolstered by growth of the public cloud market, increasing investments into digital infrastructure and enhanced connectivity.
With KDCF II having committed more than 90% of its total funds, Keppel is planning to launch the third vintage of its flagship data centre fund series later this year. Leveraging its strong track record in Asia Pacific, as well as Keppel’s integrated ecosystem providing access to energy infrastructure and subsea cables among other critical expertise and resources, the upcoming Keppel Data Centre Fund III and co-investments from other investors could translate into a FUM of S$10 billion.
