NTT DC REIT (NTDU) Citi's 2026 Pan-Asia Conference summary

Key highlights and financial performance

• Outperformed IPO forecasts with NPI up 2.3%, distributable income up 2.5%, and DPU up 2.6% for FY25/26, driven by operational strength and positive FX movements.

• Portfolio valuation rose 11.3% to US$1,670.2m, reflecting acquisitions and market appreciation.

• Strong leasing momentum with robust rental reversion of +8.5% (13.7% including NTT Singapore lease renewal), and portfolio occupancy at 95.1%.

• SG1 Master Services Agreement renewal secured a 23% rental uplift, 5% annual escalations, and a 3-year lease term starting April 2026.

• Aggregate leverage remains healthy at 31.3% post-distribution, with 100% unencumbered portfolio and 70% fixed rate debt.

Operational and portfolio updates

• Six assets across the U.S., EMEA, and APAC with 90.7MW design IT load and 95.1% occupancy as of March 2026.

• Weighted average lease expiry stands at 4.5 years, with less than 17% of leases expiring in FY26/27.

• Top 10 customers contribute 75.4% of monthly base rent, with a weighted average escalation of 3.1%.

• Vienna and Singapore assets saw valuation increases of 10.4% and 21.5% respectively since IPO.

• No debt maturities in the next two financial years, providing stability and flexibility for future growth.

Market and strategic outlook

• Sacramento is emerging as an edge market, benefiting from spillover demand from Silicon Valley and tight vacancy rates around 5%.

• Northern Virginia remains the largest global market, with supply expanding but facing policy and community constraints.

• Vienna and Singapore markets are supply-constrained, supporting gradual to moderate rental growth.

• Management is considering changes to the fee structure to better align with unitholders, targeting an EGM by 3Q FY26/27.

• Sponsor NTT Limited, part of NTT Group, leverages a global data center platform with over 2,400MW capacity and strong Fortune Global 100 client base.