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Can Keppel DC REIT stay afloat amid Singapore’s property supply glut?
Substitutions may pose a serious threat to demand.
A deluge of available space in the property market is no skin off Keppel DC REIT’s nose, as analysts believe that strong demand for the company’s properties will match the supply glut.
According to a report by CIMB, the threat of substitutions in Singapore is also minimal for Keppel DC REIT as it is not easy to convert and industrial building into a DC space. In particular, floor loading would prove to be a major impediment.
Moreover, CIMB asserted Keppel DC REIT continues to see healthy dynamics in European countries, as well as in Sydney.
Similar to its Singapore market, Sydney was previously thought to be oversupplied but robust demand led to absorption of surplus place.
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