Asia-Pacific Data Center Market to beDriven by Rapid AI Development

The widespread use of cloud computing and artificial intelligence (AI) is fueling exponential growth for the data center industry, according to JLL's new Global Data Centre Outlook. Hyperscalers and edge data centers, which account for 79% of total demand, are the fastest-developing segments of the market.

According to JLL, the hyperscale industry is projected to increase by 20% between 2021 and 2026 as many technology companies seek to satisfy the rising demand for data processing and storage. Globally, more than 300 new hyperscale sites are currently under construction, and this number is projected to exceed 1,000 by the end of 2024, up from approximately 500 sites just five years ago.

Despite economic headwinds, Asia will continue to adopt data centers thanks to factors like the continued use of social media, which has 938 million users in mainland China and 467 million users in India. JLL stated that Tokyo, Hong Kong, Singapore, and Sydney maintain their status as regional hubs, with a total inventory of 3000MW and 765MW under construction. Due to rising mobile phone usage, businesses are increasingly contemplating other hubs and edge markets, such as Jakarta and Mumbai.

However, development is not without its difficulties. 53% of data center operators worldwide struggle to locate qualified candidates, and 42% struggle to retain employees. Alongside talent, data center developers, operators, and investors now prioritize sustainability, which includes addressing energy consumption and emissions. Legislation and self-regulatory efforts, such as Singapore's Data Centre Moratorium, are establishing environmental standards for the industry.