APAC Data Centre Update: H2 2024

group, four are from India. This reflects the confidence among operators and end clients on long-term growth the market holds. Since these are newer markets that had witnessed rapid expansions over the past few quarters, the average vacancy rate surged to about 25%. However, with rising demand, we anticipate the vacancy rates to decline over the year and to have a more balanced supply-demand ratio. EMERGING markets since our last update have increased their share in operational capacity from 3% to 5% at the end of 2024. Owing to evolving dynamics, 11 markets now fall in this group, including Busan, Auckland, Taipei, Canberra, Brisbane, Perth, Bengaluru, Manila, HCMC, Hanoi, and Batam. These markets are in their early stages of development having an average of only 58MW in operational capacity, and are gaining importance for diverse factors such as organic growth in demand, landing station connectivity, spillover demand centre, regional economic hub, etc. Since these markets are predominantly driven by retail clients, we expect a slow rate of leasing colocation spaces in these markets. Therefore, the vacancy rates in these markets are likely to remain high for the foreseeable future. SUMMARY: The Asia Pacific data centre market experienced significant growth in 2024, and an even sharper expansion is expected in 2025. Governments and enterprises across the region are accelerating investments in digital infrastructure, driven by the progressive onset of AI workload adoption, big data analytics, and edge computing. This surge in demand is prompting hyperscale CSPs to expand their regional footprint. Additionally, the widespread adoption of 5G technology and the IoT is generating massive volumes of data, increasing the need for low-latency processing capabilities closer to end-users. As markets continue to evolve and mature, the strong potential for investment and favorable returns has encouraged investors to deploy substantial capital into acquiring data centre assets and businesses across the region. The market continues to witness new entrants from diverse sectors such as real estate, renewable power, infrastructure, etc. entering the data centre business. Looking ahead to 2025, demand is expected to accelerate further, driven by advancements in emerging technologies such as quantum computing and AI-driven automation. Southeast Asia is poised for the highest growth, with Indonesia, Malaysia, and Thailand emerging as key regional hubs, supported by expanding digital economies and government incentives. However, challenges such as power shortages, land constraints, and geopolitical tensions may pose hurdles to expansion strategies

CUSHMAN & WAKEFIELD | ASIA PACIFIC DATA CENTRE MARKET OVERVIEW (*Overall stock of markets shown on this graph include Operational, Under Construction & Planned capacities)