Perth is emerging as Australia’s next potential data centre hub, with Knight Frank’s Head of Data Centre declaring the WA capital has a “key strategic advantage” in the market.
Knight Frank’s Global Data Centres Report – 2025 found Australia was the world’s second top destination for data centre investment last year.
Investors poured $6.7 billion into the Australian market across 2024, slightly higher than third-placed Japan ($6.5 billion) and more than double fourth-placed Netherlands (2.6 billion).
The United States reigned supreme as the top-placed destination with more than $14.5 billion invested.
Knight Frank’s Head of Data Centre Fred Fitzalan Howard said Perth is “emerging as a logical next stop” for investment, as land and electricity grid constraints posed challenges for Melbourne and Sydney.
“With AI adoption accelerating and data sovereignty laws gaining traction, Australia is becoming a preferred destination for GPU-intensive workloads—especially compared to Southeast Asia,” Mr Howard said.
“However, Sydney, the country’s main data centre hub, is now grappling with soaring land prices and tightening power availability.
“This has pushed significant development toward Melbourne, but with land and grid capacity also finite there, Perth is increasingly emerging as a logical next stop.
One of Perth’s key strategic advantages is its direct access to multiple international subsea cable systems, which link Western Australia to Southeast Asia, the Middle East, and beyond.
“These cables provide low-latency connectivity to key global markets, making Perth not just a backup location, but a potential gateway for international data flows and AI workloads.”
Data centres offer predictable income streams through long-term lease agreements with hyperscalers, enterprises, and colocation clients, often extending to 15+ years, according to the Global Data Centres Report – 2025.
“Triple-net leases are frequent, passing operational costs such as maintenance and utilities to tenants,” the report said.
“With tenants like cloud providers and financial institutions requiring uninterrupted service, high retention rates further enhance income stability.”