CPPIB Comes Out on Asian Data Centers?

Lynette Khoo of Singapore's Business Times reports, CPPIB invests up to S$350m in Keppel's Alpha Data Centre Fund:

The Alpha Data Centre Fund (ADCF), managed by Keppel Capital's wholly owned unit, Alpha Investment Partners, is receiving another shot in the arm from Canada Pension Plan Investment Board (CPPIB), which is investing up to US$350 million of capital, with an option to invest another US$150 million.

CPPIB's latest commitment and option will bring the ADCF's total fund size to up to US$1 billion, doubling the Fund's initial target size of US$500 million.

When fully leveraged and invested, the Fund will potentially have assets under management of about US$2.3 billion, said Keppel Capital, the asset management arm of Keppel Corporation.

Jimmy Phua, CPPIB managing director and head of real estate investments for Asia, said: "The continued strong growth in data requirements globally has driven demand for quality data centre space, particularly in the Asia-Pacific region where digital infrastructure is relatively under-developed. By investing alongside the ADCF, CPPIB is able to gain exposure into this critical sector."

The ADCF was launched in July 2016 by Alpha amid strong interest from institutional investors for quality alternative asset classes.

This fund taps the experience of Keppel Data Centres - a 70-30 joint venture between two Keppel group entities, Keppel Telecommunications & Transportation Ltd and Keppel Land - that has designed, built and managed data centres for more than a decade.

The Nikkei Asian Review also reports, Canadian Pension Fund To Invest In Singapore Keppel's Asset Management Business:

Canada Pension Plan Investment Board has decided to make an initial investment of up to $350 million, with an option to invest another $150 million, in Alpha Data Centre Fund, the asset management business of Singapore's Keppel Corporation.

CPPIB's latest commitment and option will bring the ADCF's combined and co-investment interest up to $1 billion, double its initial target size of $500 million, Keppel said in an exchange filing today. "When fully leveraged and invested, the fund will potentially have assets under management of approximately $2.3 billion."

ADCF is managed by Alpha Investment Partners Limited, the private fund management arm of Keppel Capital, a Keppel Corp unit.

Keppel Corp is best known for its rig building and property businesses.

CPPIB is looking into the digital future and wisely investing in Asian data centers alongside its partner, the Alpha Data Centre Fund (ADCF), the asset management business of Singapore's Keppel Corporation.

I've already covered why PSP, Ontario Teachers' and other large Canadian pensions are investing in data centers so I don't want to dwell on this topic too long. We live in a data-driven world where data and data analytics are an integral part of our lives.

However, I do want to refer you to an article Paul Mah wrote a couple of years ago in Datacenter Dynamics, The rise and rise of data centers in South East Asia:

There is no question that the data center landscape in South East Asia is a vibrant and growing one, with many new developments and happenings taking place in the region. A significant proportion of the action in this region is centered on Singapore, where many data center operators are busy building their second or even third data centers.

For example, Telin Singapore in June held a groundbreaking ceremony for its Telin-3 data center, which will be built on the first plot of land awarded at the Singapore data center park. On its part, Digital Realty will have its second data center here converted and ready for an estimated late-2015 first phrase delivery, while 1-Net’s 1-Net North data center is currently scheduled for completion by the first quarter of 2016.

Cloud providers too, have been setting up in the island nation to tap into the growing demand in this region. The name list includes the likes of Amazon Web Services (AWS), Microsoft Azure, Digital Ocean, GoDaddy, and Linode, to name a few.

Interestingly, the country is also the place where East meets West, with Aliyun, the cloud division of China’s Alibaba Group, announcing in August that its second overseas data center and international HQ will be set up in Singapore.

Acquisitions are also happening as larger players turn their attention to the region. Colt acquired KVH last year, and more recently, the Hong Kong and Singapore based Pacnet was acquired by Australia’s Telstra as it sought to strengthen its subsea network and data center assets in the region.

Innovation in the region

Local challenges have also resulted in some developments that may be viewed as unorthodox or even frowned upon elsewhere. In land-scarce Singapore, both Equinix and Google have opted to build a new data center right next to an existing one, with the latter having built its first ever multi-level data center here.

For Equinix, building its third data center (SG3) across the road to SG1 gives it the advantage of running direct fiber links to the many telecommunication operators and network providers that already have a Point of Presence there.

When it comes to Google, the reason presumably has to do with the fact that there is no need to build at a separate location, not when you consider the lack of natural disasters, excellent security, and relatively low number of violent crimes.

In Indonesia, the JK1 data center in Jakarta that was built as part of a partnership between Equinix and PT Data Center Infrastructure Indonesia (PT DCI) is fed by an on-site power station to mitigate the risk of an unstable power grid and to protect it from local power shortages.

For all the progress and innovations, much work remains to be done when it comes to sustainability here, especially in the dense urban areas where traditional sustainable energy options such as hydroelectricity, solar and wind power are not available.

This has not stopped some such as Singapore from promotion the use of high-grade reclaimed water it calls NEWater for cooling data centers. More needs to be done, however, and it will be interesting to see where the future will take us.

It will indeed be interesting to see where the future will take us. There are a lot more challenges in Asia than here in Quebec where we have lots of land and hydroelectric power, making us a prime spot to host large data centers.

But wherever Asia's data center future takes us, CPPIB will be invested in it, that much I guarantee you. These investments are part of CPPIB's long-term thematic approach across public and private markets all over the world.

And to do this properly, CPPIB and others need to find the right partners in Asia to partner up with. In this case, it's the Alpha Data Centre Fund (ADCF) which recently invested in a newly built facility in Singapore worth SGD170m (€108m):

Alpha Data Centre Fund has taken a 70% stake in the asset through a 70-30 joint venture, known as Thorium, with Keppel Data Centres.

Keppel Data Centres developed the 16,900sqm facility which is spread over five floors. More than 25% of the space has been committed.

Alpha, itself a subsidiary of Singapore’s Keppel Group, raised US$130m (€113m) for the fund in a first close a year ago.

It's clear that this fund specializes in Asian data centers, and that's all its managers specialize in.

In other CPPIB related news, this week, CPPIB celebrated the National Coming Out Day as part of its focus on inclusion and diversity (click on image):

CPPIB’s Women’s Initiative aims to ensure CPPIB actively hires, develops and engages women and Out@CPPIB helps foster an environment where LGBT+ employees feel comfortable bringing their whole selves to work. Out@CPPIB does this by leading activities externally and within CPPIB to ensure the recruitment, retention and development of LGBT+ talent.

CPPIB's President and CEO Mark Machin even proudly showed his support of the LGBT+ community on National Coming Out Day (click on image):

I couldn't resist to post this comment on LinkedIn: "We're in 2017, anyone who still has an issue with the LBGT community is completely out to lunch. #promotediversityintheworkplace".

Honestly, and I don't want to be controversial or minimize the struggles of women and the LBGT+ community in the workplace, but we live in 2017, anyone who has an issue with working with or reporting to women or anyone in the LBGT+ community is simply out to lunch and doesn't live on this planet. Period. 

It's like saying I have a problem working with blacks, Jews, Greeks, Indians, Latinos, Asians and Muslims. We shouldn't even give it a second thought.

In 2008, when I was working at the Business Development Bank of Canada (BDC) replacing a senior economist on maternity leave, my direct supervisor was a woman. She was very competent at her job but not particularly good at managing people, and this was blatantly obvious to her subordinates and eventually to her superiors (she's still there, thriving but doesn't manage anyone). 

Anyway, I had to work closely with a very nice homosexual man who was our graphic designer. He was openly gay and proud of it. A bit too proud and he sometimes crossed the line but in a harmless and joking way, knowing I was a proud heterosexual Greek-Canadian. Sometimes he would compliment the way I looked, dressed or smelled but he was teasing me, and I teased him back to the point where we would make other employees laugh and a bit uncomfortable at times. 

In fact, when it got too much, we even told each to tone it down or else we're going to get in big trouble (there is a line where jokes and teasing become inappropriate and unacceptable even if there is mutual consent).

My point here is working with people from the LBGT+ community is no big deal regardless of whether they are open or not about their sexuality. I even know one very senior pension fund manager in Canada who is openly gay. Moreover, my 86 year-old father who still works as a psychiatrist tells me 50% of the staff psychiatrists are gay and they bring their partners to  parties and events, something which was unheard of 45 years ago when he first started working (my father is very open-minded and enjoys conversing with all his colleagues) . 

It's no big deal. Where it becomes a big deal is when one suffers workplace bullying or discrimination (overt or tacit) based on the color of their skin, their religion, sexual orientation, gender, or disability. 

Earlier this week, I wrote about Quebec's atypical pension fund chief, where I unleashed another tirade about how people with disabilities are treated inhumanely by Canada's large private and public organizations:

Many years after la Révolution tranquille (the Quiet Revolution), Quebec has a serious reverse racism problem which is ingrained in its large public and private organizations. Many anglophones and ethnics have given up hope living here and the ones that stayed are pushing their children to leave this province or stay and face reverse discrimination.


I'm not going to mince my words here, and I can look in the eyes of Louis Vachon, Guy Cormier, André Bourbonnais and many other French-Canadian leaders who sit on the board of Finance Montréal or le Cercle Finance du Québec and tell them this province is going down the tubes in terms of diversity in the workplace and they're either going to take concrete actions to promote it at all levels of their organization or Quebec as we know it is doomed in the future.


By the way, I would say the exact same thing to Premier Philippe Couillard and Prime Minister Justin Trudeau who has no clue what a mafia the federal public service has become in terms of getting in and how it regularly ignores important diversity laws. When our own public institutions aren't practicing diversity in the workplace, it sets a terrible example for private organizations.

In particular, and let me be crystal clear here, the way Canada's large public and private organizations treat people with disabilities is a national disgrace and travesty.


I blame our leaders at public and private organizations for this national disgrace. They make every excuse in the book for not hiring competent people with disabilities at all levels of their organization but at the end of the day, they know I'm right to criticize them openly and publicly and I challenge them to show me the numbers to prove I'm wrong.


Anyway, don't get me started on that topic, discrimination in all its ugly forms makes my blood boil, just like it made Michael Sabia's blood boil when he had to defend his Québécois roots to the likes of Jean-Martin Aussant years ago.

As someone who was diagnosed with Multiple Sclerosis 20 years ago and lives discrimination I will do everything in my power to expose the plight of people with disabilities (I'm actually one of the lucky ones, doing relatively well, but have seen way too much injustice to keep my mouth shut on this national travesty).

On Thursday, Quebec Premier Philippe Couillard shuffled his cabinet before next year's provincial elections and also appoined a Minister of Anglo affairs for the first time, realizing there's a huge problem with the way anglophones are treated in this province.

I'd love to see him appoint a Minister of People with Disabilities just like we have at the federal level because if there's one minority group who is ruthlessly and systemically neglected and mistreated in our society, it's people with disabilities. For example, in Quebec, wheelchair users face severe job market discrimination which is totally unacceptable and against the law (not that the situation is better in the rest of Canada).

There's a reason why the unemployment rate for people with disabilities by some estimates reaches a shocking 70% or higher. Nobody really knows or cares about the full extent of real problem but suffice to say it's a national travesty.

"But Leo, it's not easy accommodating people with disabilities. It's much easier focusing on women and the LBGT+ community because at least they can walk and don't have any physical or mental disabilities that require accommodations we're not willing to do or aren't properly trained for."

My reply to this pathetic line of reasoning is stop being ignorant, get informed, there are a few non-profit organizations doing great work helping people with disabilities, and if you're not willing to actively recruit and hire people with disabiltiies who arguably need the most help (along with Aboriginal people), then not only are you violating the spirit of the law, you're part of the problem.

Earlier this week, JP Morgan Chase posted a beautiful article by Lisa Lucchese, Disability to Some; Extraordinary Ability to Others. Mrs. Lucchese is Global Finance and Business Management, Global Head of External Reporting Operations & Co-Executive Sponsor of Access Ability, Mid-Atlantic Region.

Anyway, her comment is a must-read because she explains how she dealt with her mental illness and got support from her employer. She ends on this note:

The Office of Disability and Inclusion Policy has allowed me to get comfortable sharing my story in an effort to help current and future employees who suffer or have suffered in the past. Access Ability is an internal facing Business Resource Group here at JPMorgan Chase, aimed at bringing employees with disabilities and caregivers together as a way to foster networking opportunities and a sense of camaraderie. As the newly appointed co-executive lead for Access Ability for the Mid-Atlantic region, I hope to raise awareness, offer encouragement to others and to be an advocate on their behalf. Imagine the day when employees or prospective employees with Attention Deficient Disorder (ADD) or other types of diagnosis can ask for the assistance they may need to enable success.


I work for a company that leads by example and is willing to break down barriers and promote a diverse and inclusive workforce. Imagine a day where employees and prospective employees with mental illness are a competitive advantage for this great firm. That day is here!

Wouldn't it be nice if all public and private organizations had an Office of Disability and Inclusion Policy? When are we going to see disABILITY@CPPIB, a sincere effort to actively recruit and hire people with disabilities from across Canada at all levels of the organization?

And by the way, I'm not picking on CPPIB. I've met Mark Machin and think he's extremely nice and humble and very engaged in social issues (a lot more than others who blow hot air on diversity). He's also extremely knowledgeable on Multiple Sclerosis and we had a private conversation on this disease and how it's important to help people with disabilities. 

Do you know from all the organizations I ever worked at, the only place where I saw a couple of employees in a wheelchair was at the BDC? To its credit, the BDC is fully equipped to handle their needs but even that organization has a lot more work to do in terms of hiring more people with disabilities.

My message to all of Canada's leaders is stop talking about diversity and inclusion and start acting upon it, placing a special focus on disadvantaged minorities that need it the most. It's not going to be easy but nothing worthwhile ever is. 

What does all this rambling on diversity and people with disabilities have to do with Asian data centers? Nothing, it's my blog and I'm free to express myself in any way I see fit. You're also free to agree, disagree or ignore me, but I'm not keeping quiet on issues that matter to me. There are too many people with a disability suffering alone, alienated and unable to express their plight so I'm using my platform to awaken the powers that be and hopefully they can start doing something about this.

Below, Joe Lonsdale, a founding partner at 8VC, talks about reinventing the way technology is used to monitor big data problems. This is a fascinating discussion.

Also, PBS Economics correspondent Paul Solman reports on how the unemployment rate for people with a disability is more than double than for those without even though the law bars such discrimination, it can be difficult for these Americans to get hired (it's actually much higher here in Quebec where wheelchair users face severe job market discrimination and are routinely ignored).

But that’s not the full story: Some employers are seeing how the special abilities of workers on the autism spectrum can boost their bottom lines. Watch this excellent report and be empathetic and open-minded.