Lendlease Tokyo: Lendlease to build $600m hyperscale data center in Japan

Aug 18, 2021 | Posted by Abdul-Rahman Oladimeji

Lendlease is penetrating the Japan data center market by announcing that it is developing its first data center in Japan. It will be making this development through its Lendlease Data Centre Partners (LLDCP) joint venture. This will be an hyperscale facility, and it will be on 33,000 sqm (355,200 square feet) of land in Greater Tokyo. When completed, the facility will also deliver over 60,000 sqm (645,800 square feet) of gross floor area.

The Company will begin construction of the facility later in the year. The first phase of construction is also scheduled to be completed in 2024. Lendlease says the project will cost $600 million (A$800 million) gross. However, the Company did not reveal the specific details of the cost.

Lendlease Data Centre Partners (LLDCP) is a joint venture funded 20% by Lendlease and 80% by an unnamed global institutional investor. According to Lendlease, the proposed data center in Japan will be one of the biggest in the country.
Rendering of the Lendlease Greater Toyko facility due to come online in 2024

Lendlease Press Release on Aug 16, 2021:
Lendlease today announced its first data centre development in Japan under Lendlease Data Centre Partners (LLDCP).

With an end development value in excess of A$800 million (US$600 million)1, the data centre will be one of the largest in Japan

Lendlease today announced its first data centre development in Japan under Lendlease Data Centre Partners (LLDCP). The data centre development will be one of the largest of its scale in Japan, poised to fuel an increasingly important global digital economy.

Located in Greater Tokyo, the facility is sited on approximately 33,000 sqm of land. The phased development is planned to deliver more than 60,000 sqm of gross floor area, in which close to half of the site has been pre-leased. Construction will commence later this year with the initial phase to be completed by early 2024. The gross development value of the project is in excess of A$800 million (US$600 million)1 upon completion of all phases.

Demand for data centres has surged during the ongoing COVID-19 pandemic with digitalisation emerging as a top priority for businesses amid an overall shift to a digital-led economy. Japan is well-placed as a key connectivity and distribution hub for global hyperscale cloud providers, which, in turn, is driving high demand from data centre service providers.

LLDCP is funded 20 per cent by Lendlease and 80 per cent by a global institutional investor. The fund’s mandate covers Australia, China, Japan, Malaysia and Singapore, and includes both completed assets and new development opportunities. Under the partnership, Lendlease undertakes development, construction, property and investment management.

Quote attributable to Managing Director of Japan & Head of Telecoms and Data Infrastructure Asia, Andrew Gauci:
“The demand for data centres in the Asia Pacific is set to grow exponentially, with internet-related services usage soaring due to the pandemic. We are excited to launch our first data centre development under Lendlease Data Centre Partners. This project is of significant scale in a sector of growing importance in the digital economy, leveraging our more than 20 years’ experience in the local communications and data infrastructure space, as well as Lendlease’s broader presence in Japan for over 30 years.”

Quote attributable to Chief Executive Officer Asia, Justin Gabbani:
“This partnership is an exemplar of our updated strategy in action, leveraging our competitive edge and creating value with our partners. With our end-to-end integrated capabilities, we look forward to building on this to explore further investments in the future. This further cements our global leadership in providing best-in-class real estate solutions. Moreover, this also marks a significant milestone for the Group, adding to its global development pipeline alongside five other new urbanisation projects globally.”