Guess which three cities led data centre growth in APAC  | Real Estate Asia

Guess which three cities led data centre growth in APAC 

The region’s new capacity increased by 488 MW in Q1. 

According to Knight Frank’s latest Data Centre Report in partnership with DC Byte, there was an additional 488 MW in new capacity in the first quarter, a significant increase from 185 MW in the previous quarter. This brought the total capacity in the region to more than 8,700 MW.

This growth was mostly driven by Tokyo, Sydney and Seoul, with Sydney crossing the threshold to become a gigawatt market. Across the region, 203 MW of capacity was absorbed this quarter largely due to public cloud activity, a number significantly higher than the average 127 MW per quarter as previously observed in 2021.   

In contrast, there has been little market activity in Singapore since the imposition of the moratorium on data centre developments in 2019. However, this is expected to change over the coming years with the pilot call for applications from Q2 2022. Similarly, Hong Kong has been experiencing reduced activity due to strict COVID measures leading to the withdrawal of people and businesses from the market. This worsened with the surge of cases in February and March.  

Adeline Liew, Data Centres Lead for Asia-Pacific, Knight Frank said: “While a new wave of COVID-19 infections may have hampered data centre development in Greater China markets this past quarter, overall, COVID-19 has actually been a boon to data centre demand in Asia-Pacific, as it has led to a tremendous increase in both appetites for the cloud due to the shift to hybrid work as well as an increase in overall internet penetration. Because of this trend, we have noted increasing interest in several markets across Asia-Pacific in both established markets as well as developing Southeast Asia markets.”

Ben Stirk, Co-Head, Global Data Centres at Knight Frank, said: “Despite significant headwinds - the legacy of Covid, geopolitical turmoil and rising inflation – the Asia-Pacific region continues to register strong data centre growth. The fundamentals support this trajectory, with Asia being the most populous continent and a region where digital transformation is accelerating at pace. There is tremendous hyperscale growth potential underpinned by domestic demand. This, combined with the continued reopening of economies and the loosening of restrictive regulation means further above-trend growth can be expected moving forward.”

To view the latest Data Centre Report please click here.


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