Johor on track to be a 1GW data centre market by end-2026

A total of 160MW of capacity has been added in just six months.

Since the last update from Cushman and Wakefield in H2 2024, Johor has added 160MW of new operational capacity – a 40% increase in just six months. Data from the analyst’s report reveals that under-construction capacity has surged by 87% to 422MW, while planned capacity has grown by 61% to 1,324MW.

“At this pace, Johor is on track to become a 1GW market by end-2026. Initially developed to absorb spillover demand from Singapore, Johor has rapidly matured into a regional hub for cloud and AI deployments, serving customers across Southeast Asia,” the report said.

Here’s more from Cushman and Wakefield:

Some notable developments highlighting the accelerated deployment of advanced technologies in Johor include BrightRay’s initiative to complete its facility within eight months using a prefabricated modular data centre solution. Yondr also made significant strides by delivering a fully fitted out and rack-ready asset six months ahead of schedule. In February 2025, STT GDC announced the construction of a hyperscale data centre in Nusa Cemerlang Industrial Park, with Phase 1 – offering 16MW of capacity – scheduled for completion by end-2026.

Effective 1 July 2025, Malaysia introduced its new power tariffs. Following the announcement, several analysts and media outlets projected a 10% to 14% increase in power costs for data centre operators. However, despite the anticipated rise, Malaysia continues to rank among the top three markets with the lowest power tariffs in the Asia Pacific region. As such, we do not expect any significant changes or disruptions to Johor’s position as a leading cloud and AI hub.

Market activity remains strong, with new entrants continuing to expand the landscape. Currenc Group, a fintech firm, announced its entry into the data centre sector with a 100-acre, 500MW hyperscale AI campus in Johor. Similarly, Stack Infrastructure unveiled plans for a 220MW campus in Iskandar Puteri, with the first phase scheduled for delivery by Q4 2026. While development remains concentrated in Nusajaya/Iskandar Puteri and Sedenak, emerging locations such as Kulai, Tebrau, and Pasir Gudang are gaining traction. These areas now account for nearly 400MW – approximately 23% – of the total development pipeline.

On the regulatory front, the Malaysian government has introduced new export controls on US-made AI chips to curb unauthorized semiconductor trade. Effective July 14, 2025, high-performance AI chips of US origin are now classified as Strategic Items, requiring a Strategic Trade Permit and a mandatory 30-day advance notification before export, transshipment, or transit. This move, led by the Ministry of Investment, Trade and Industry (MITI), aims to close regulatory gaps and enforce the Strategic Trade Act 2010. The policy aligns with broader US efforts to tighten chip export restrictions.