The APAC data center construction market is experiencing a seismic shift, with a projected CAGR of 12.32% from 2024 to 2030, according to Arizton’s latest research report. This growth trajectory, fueled by the region’s digital transformation, underscores a critical juncture in the intersection of sustainability and construction.
The market, valued at USD 26.25 billion in 2024, is poised to surge to USD 52.72 billion by 2030. This exponential growth is not merely a numbers game; it reflects a profound transformation in how the APAC region is embracing technology and sustainability. The region’s data center construction market is expanding at an unprecedented rate, driven by the escalating demand for high-speed internet, the proliferation of IoT, big data, and AI adoption, and the rise of 5G networks. These technological advancements are not just enhancing connectivity; they are reshaping urban landscapes and redefining the very essence of modern infrastructure.
China, with a dominant market share of around 49%, is at the forefront of this digital revolution. The country’s strategic investments in data centers are pivotal to its vision of becoming a global tech leader. China Mobile’s launch of a new data center in Beijing, equipped with AI chips, exemplifies this trend. Similarly, AWS’s acquisition of land for a new data center in Mumbai and Vantage Data Centers’ launch of its TPE11 facility in Taipei highlight the region’s commitment to digital infrastructure.
The APAC data center construction market is not just about building new facilities; it’s about repurposing existing structures and integrating sustainable practices. Brownfield development, which involves converting abandoned buildings or industrial facilities into data centers, is gaining traction. This approach not only accelerates construction timelines but also aligns with the region’s sustainability goals. The incorporation of renewable energy sources, such as wind and solar, into data center operations is a testament to this commitment. For instance, ST Telemedia Global Data Centres became the first operator in Singapore to adopt HVO (Hydrotreated Vegetable Oil) fuel as a diesel alternative for power backup in data centers, with an initial deployment of 50,000 liters in 2024. This shift towards sustainable energy sources is expected to create numerous opportunities for contractors and subcontractors, fostering a skilled workforce in the region.
The trend towards AI-ready data centers is another significant development. As AI workloads continue to surge, data center operators are designing facilities to accommodate these high-demand tasks. Blackstone and ESR’s development of AI-based data centers in Japan in 2024 is a prime example of this trend. This focus on AI readiness is not just about meeting current demands; it’s about future-proofing the infrastructure to support the next wave of technological advancements.
The demand for Edge Data Centers is also accelerating, driven by the expansion of 5G networks. Edge data centers are becoming crucial, particularly in tier 2 and tier 3 cities lacking robust connectivity. This trend underscores the need for decentralized data processing, which can reduce latency and improve the performance of applications that require real-time data processing.
The APAC data center construction market is not just about technological advancements; it’s about creating resilient and sustainable urban environments. The construction of data centers in the APAC region is primarily categorized into greenfield and brownfield developments. Greenfield development involves building new facilities from scratch on vacant land, while brownfield development focuses on repurposing existing structures. This dual approach ensures that the region’s data center infrastructure is not only technologically advanced but also environmentally sustainable.
The core and shell development of data centers, which includes site selection, preparation, and the construction of the physical facility, is a critical aspect of this market. The construction process can take up to a year, with infrastructure installation and commissioning services requiring an additional six months. Data center developers focus on building facilities in areas that are free from natural disasters and equipped to withstand environmental challenges such as earthquakes and floods. This focus on resilience is crucial in a region prone to natural disasters.
The APAC data center construction market is a microcosm of the broader trends shaping the global construction industry. It highlights the need for sustainable practices, technological innovation, and resilient infrastructure. As the region continues to invest in data centers, it is not just building digital infrastructure; it is laying the foundation for a sustainable and technologically advanced future. This transformation is not just about economic growth; it’s about creating a better world for future generations.
