The $1.5 billion deal, originally slated to gauge investor interest in early October, is now on ice. People familiar with the matter say higher borrowing costs and volatile markets have cooled demand for infrastructure assets.
AirTrunk tried to sweeten the pot. The company considered bumping the REIT yield from 5.5% to roughly 6% to make the investment palatable in a high-rate environment. It didn’t work. September’s US rate hike and fears of further increases have left investors on the sidelines.
The hesitation isn’t isolated. Firmus Grid, an Nvidia-backed data centre firm, watched its Australian IPO collapse last week due to weak demand at its target valuation. Similarly, PLDT’s data centre subsidiary in the Philippines just announced it would defer its own REIT listing to next year.
The pressure on the sector is visible in the charts. Singapore’s main REIT index has slumped 12% since late July. REITs are inherently rate-sensitive; when borrowing costs climb, the math on their debt-heavy models gets ugly fast. AirTrunk, which operates across Australia, India, Japan, and Singapore, is now weighing size and timing details while Blackstone and the Canada Pension Plan Investment Board look on.
For now, the road to the Singapore stock exchange is blocked. AirTrunk and Blackstone have declined to comment, leaving traders to watch the Fed’s next move. Until rates stabilize, the window for large-scale infrastructure IPOs in Asia remains narrow.