This week saw artificial intelligence infrastructure take centre stage with OpenAI and NVIDIA‘s (NASDAQ: NVDA) US$100 billion partnership announcement.
Speaking of deals, Keppel DC REIT (SGX: AJBU) proposed a S$707 million Japanese data centre acquisition.
In other REIT news, Centurion Accommodation REIT (SGX: 8C8U) made its public debut with its IPO being oversubscribed.
Finally, Singapore’s construction sector is set to shatter projections with demand approaching S$60 billion as mega-projects and lower interest rates driving growth, according to MayBank (KLSE: 1155).
OpenAI and NVIDIA announced a groundbreaking strategic partnership that will see the deployment of at least 10 gigawatts of NVIDIA systems for OpenAI’s next-generation AI infrastructure.
This massive undertaking represents millions of GPUs and marks one of the largest AI infrastructure commitments in history.
To support this deployment, NVIDIA intends to invest up to US$100 billion in OpenAI progressively as each gigawatt comes online.
The first gigawatt of NVIDIA systems is targeted for deployment in the second half of 2026 using NVIDIA’s Vera Rubin platform.
The partnership extends a decade-long collaboration between the two companies.
OpenAI CEO Sam Altman emphasised that “compute infrastructure will be the basis for the economy of the future” while NVIDIA CEO Jensen Huang described the investment as marking “the next leap forward — deploying 10 gigawatts to power the next era of intelligence.”
This strategic alliance complements OpenAI’s existing partnerships with Microsoft (NASDAQ: MSFT), Oracle (NASDAQ: ORCL), SoftBank, and Stargate partners.
Closer to home, Keppel DC REIT announced the acquisition of Japan’s Tokyo Data Centre 3 for S$707 million, a minor discount to its valuation.
The facility comes fully contracted to a leading global hyperscaler for 15 years with built-in annual rent escalation, offering the cash flow resilience which would make dividend investors smile.
On a pro forma basis (as if the acquisition had already happened), the purchase would have boosted FY2024’s distribution per unit (DPU) by 2.8% from S$0.09451 to S$0.09712.
To fund the purchase, Keppel DC REIT launched a non-renounceable preferential offering at S$2.24 per unit, with entitled unitholders offered 80 new units for every 1,000 units held.
Post-acquisition, the REIT’s portfolio will expand to 25 data centres across 10 markets with assets under management reaching S$5.7 billion.
