DigiCo Signs 15-Year 71MW Contract, SYD1 Fully Contracted

DigiCo (ASX:DGT) signed a 15-year contract for 71MW of capacity at its SYD1 data centre, leaving the Sydney site fully contracted and lengthening the lease profile of its Australian portfolio.

The customer is described as a global technology firm with investment grade credit support, and the 71MW includes 20MW of existing contracted capacity reallocated to it. The remaining 17MW of SYD1's 88MW is leased to co-location customers. DigiCo says the contract lifts the Weighted Average Lease Expiry of its Australian portfolio from ~3 years to greater than 10 years, with weighted average annual escalations of ~3%, on a pro forma basis that assumes the full 88MW is income-producing. Shape Australia Pty Ltd is head contractor for the 52MW SYD1 Expansion under a fixed price lump sum Design & Construct Contract, which DigiCo says is consistent with its combined SYD1 and ADL1 capital expenditure estimate of $1.2 billion over FY27-FY28. The first 10MW is expected to be income producing in late Q4 FY27, with the balance delivered over FY28. FY27 capital expenditure is expected to total $300 – 500 million, and the company reaffirmed FY27 Underlying EBITDA guidance of between $120 – 125 million.

The lease is subject to satisfaction of customary conditions and approvals. The release does not name the customer or state the contract value. DigiCo says the expansion is funded from existing liquidity, available debt facilities and proceeds from US asset sales.