Despite land limits, Hong Kong and Singapore were highly ranked as leading destinations in Asia for data centre development in 2022.
According to Cushman & Wakefield‘s recent Global Data Centre Market Comparison report, Hong Kong and Singapore are the top two regions for data centre development in APAC, and were the only two Asian markets to reach their global top ten ranking. Barriers to expansion due to limited land resources is a rising concern for the two regions to maintain their rankings and sustain growth.
“Singapore and Hong Kong have reaffirmed their reputation as top data centre markets globally, despite a lack of available developable land, with Singapore’s new development parameters and Hong Kong’s generally high land prices. Both have strong ecosystems, excellent connectivity, consistent demand, and all major cloud services available and expanding where possible,” the report stated.
Markets were ranked according to 13 categories – market size, fibre connectivity, cloud availability, incentives, taxes, political stability, vacancy, development pipeline, sustainability, smart cities, power cost, land price, and environmental risk.
Hong Kong rated highly across the categories and emerged particularly strong in terms of connectivity, consistent demand, availability of cloud services, and its business-friendly tax structure offsetting high land prices. Singapore also performed well with a low vacancy rate reflecting high demand. Its low environmental risk and status as a smart city also boosted its rank.
In addition to development barriers, the report also cited new cooling technologies, and novel data centre designs, such as floating or aquatic facilities, would be beneficial for growth. Improvements in renewable energy infrastructure would also support data centre development across Asia.
Sydney and Seoul tied for the ranking of third leading data centre in APAC followed by Tokyo, Beijing, Mumbai, Shanghai, Melbourne, and Kuala Lumpur, and Cushman & Wakefield projected India, Malaysia, and Indonesia would likely see between two and three times more capacity over the next three to five years.
The report further identified Jakarta, Bangkok, Manila, and Ho Chi Minh as emerging markets with central digital infrastructure and connectivity clusters that could lead to new opportunities with data centre providers.