Sydney, along with Tokyo and Mumbai, has fallen out of the global top 10 established data centre markets, according to the latest report by Cushman & Wakefield.
The report, which analyses 97 global markets, highlights how power access, land acquisition, and infrastructure have emerged as critical variables shaping where and how data centre facilities are being built.
The report found that established markets still capture the bulk of data centre activity, often boasting significantly larger development pipelines.
Virginia in America retained its position as the No.1 spot globally. Other US cities performed well, with Phoenix climbing to No. 2. Oregon, Ohio and Chicago also advanced in the rankings compared to last year.
Conversely, Tokyo, London, Mumbai and Sydney have dropped out of the global top 10 established data centre markets, making way for new entrants Beijing and Shanghai.
Alex Moffatt, Cushman & Wakefield’s Director, Alternatives Capital Markets and Australia Lead – Asia Pacific Data Centre Advisory Team said cost and land availability had a large role to play in Sydney.
“Based on our 2025 analysis, Sydney ranks 16th on the global scale for established data centre markets.
“Key factors in the drop this year were the cost and availability of suitable development land and the comparatively high cost of electricity. Limitations on access to water for cooling are also limiting data centre capacity. Sydney is ranked number 3 in APAC established data centre markets.”
Mr Moffatt said the lack of suitably zoned data centre development land is a consistent theme across Mumbai, Tokyo, London and Sydney.
“Land availability and access to electricity capacity is an even larger issue for Tokyo and London than it is in Sydney.”
Mr Moffatt said major challenges for the Sydney data centre market are currently access to electricity capacity and the timing for delivery of electricity connections by electricity utilities.
“Land parcels currently available in Sydney have forecast electricity energisation dates in 2028 and 2029,” he said.
“We are assisting a number of asset owners in repositioning sites which have significant existing electricity capacity to maximise the opportunity for redevelopment as data centres. These assets are primarily cool stores and plastics or metal manufacturing sites. “
Perth, Canberra and Brisbane were identified in the report as key emerging markets in the APAC region.
“Perth has been identified as a key emerging data centre market because it has large amounts of suitable land, cable connections to Asia and Africa, very low cost electricity and currently there are no restrictions on access to water for cooling,” Mr Moffatt said.
“Canberra is a fast growing data centre market which is driven predominantly by federal government workloads in the capital. Brisbane has access relatively low cost electricity and cable connections to both Asia and North America.”