Sydney is the fastest growing data centre market in Asia Pacific by megawatt growth, adding 177MW in operational capacity in H1, according to Cushman & Wakefield’s Asia Pacific Data Centre H1 2024 Update.
The report shows the Asia Pacific data centre market recorded 1.3GW of new supply in the first six months of the year, to reach a current operational capacity of 11.6GW.
In Asia Pacific, the largest six markets account for ~85 per cent of operational capacity. Sydney is the fastest growing market in Asia Pacific by megawatt growth, adding 177MW in operational capacity in H1.
The development pipeline includes 4.2GW of under construction activity and 12.0GW in the planning stage. This represents an increase of 2.8GW in development activity since end-H2 2023.
Alex Moffatt, Cushman & Wakefield’s Australia Lead – Asia Pacific Data Centre Advisory Team, said Sydney is Australia’s leading data centre hub, responsible for more than 65 per cent of the nation’s operational IT capacity and pipeline.
“In the first half of 2024 alone, the market expanded by over 177MW, making it the fastest-growing data centre market in the entire APAC region. With the Federal Government designating AI as a critical technology of national interest, we’re seeing its adoption rate in Australia projected to grow by around 19% annually through 2030. This growth will naturally drive further expansion in the data centre sector.
“Sustainability is quickly becoming a defining issue for Australian data centres. The Federal Government is tightening energy efficiency regulations, and any centre hosting federal agency workloads will need to achieve a five-star NABERS rating, setting a new industry standard for environmental performance.”
It comes as the investable universe of the Australian data centre sector is forecast to nearly double to AU $40 billion in the next four years, new CBRE research shows.
CBRE’s Australia’s Data Centres 2024 report estimates the Australian investable universe for data centres currently sits at $23 billion and is tipped to hit $40 billion by 2028.
“Demand for data centres in Australia is increasing exponentially, key drivers for this are greater data generation and storage needs, growing adoption of cloud computing services, and advancements in technology, particularly the adoption of AI,” CBRE’s Australian Head of Industrial & Logistics Research and newly expanded role to include Head of Data Centre Research, Sass Jalili said.
“Several global data centre operators have a presence in Australia, and their built-out capacity (megawatts), has been growing over the past decade. Both large and small players have expanded their server networks and upgraded data storage service facilities to meet rising demand for the industry’s services.”
The report also found land for data centres is now competing with the demand for industrial and logistics space, as the size of land required for data centres is growing. “The average size of land purchased for data centres has grown significantly just in the past six years, from 1.3ha in 2018 to 15.7ha in 2024,” Ms Jalili added.
Largest markets by operational capacity
|
Rank |
Geography |
Capacity (MW) |
Capacity (GW) |
|
1 |
Chinese mainland |
4,199 |
4.20 |
|
2 |
Japan |
1,423 |
1.40 |
|
3 |
India |
1,406 |
1.40 |
|
4 |
Australia |
1,230 |
1.20 |
|
5 |
Singapore |
985 |
0.99 |
|
6 |
South Korea |
649 |
0.65 |
|
7 |
Hong Kong, China |
584 |
0.58 |
|
8 |
Malaysia |
349 |
0.35 |
|
9 |
Indonesia |
296 |
0.30 |
|
10 |
Taiwan, China |
246 |
0.25 |