APAC Data Centre H2 2023 Update

NORTHERN VIRGINIA (NoVa): NoVa has continued its status as the preeminent North American data centre market despite growing headwinds for land and power availability. Recognised as the global leader in data centre capacity, NoVa’s operational capacity of 4.6GW is 130% higher than Beijing (2GW), the largest market in Asia Pacific. Moreover, the NoVa market alone is equivalent to 40% of the cumulative operational capacity and 35% of under construction capacity in Asia Pacific. Despite having extensive operational data centre capacity, NoVa continues to maintain amongst the lowest vacancy rates globally, at under 1%. This would suggest a roadmap for Asia Pacific powerhouse markets to continue to grow in scale while keeping steady occupancy going forward. SUMMARY: The primary markets in Asia Pacific continue on a steep growth trajectory with powerhouse markets Mumbai, Beijing and Tokyo forecast to grow into 3GW-sized markets. While many data centre markets across the region show significant capacities across all stages, including operational, under construction, and planned, they remain much smaller when compared to NoVa, which is the largest data centre market in the world. From a region-to-region comparison perspective, Asia Pacific’s population is ten times greater than that of the U.S., with similar operational capacities of around 10GW. This signifies that there is plenty of headroom for further growth and plenty more opportunities for the data centre sector in Asia Pacific. The tailwinds provided by technological advancements in recent years such as the implementation of cloud computing, deployment of 5G networks, government digitization initiatives and increasing mobile and internet penetration, especially in fast growing populations, have significantly accelerated the demand for data centres globally. However, the introduction and growing adoption of artificial intelligence (AI), and more significant;y, generative AI, is expected to drastically increase demand for more data centres, especially campuses that can cater for larger capacities, globally. Whilst the U.S. has started to see the tangible impact of AI as the next biggest influence on the sector since cloud computing, Asia Pacific is slower in experiencing its effect just yet. However, we anticipate that there is potential for AI to double the demand for data centres in the region over the next few years.

Total capacities indicated include operational, under construction, planned and land banked IT loads for Hyperscale Cloud, Colo, Edge & Telco data centre facilities in the market and exclude Captive & ICT facilities.

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