Global property consultancy Knight Frank has released its latest Global Data Centres Report, forecasting the data centre market to grow at a compound annual growth rate (CAGR) of 18% over the next five years, reaching $4t by 2030. The report anticipates capital expenditure to exceed $286b by 2027, driven by increasing demand for AI-optimised infrastructure, cloud services, and enterprise digital initiatives.
The report highlights a projected 46% increase in global data centre capacity over the next two years, adding approximately 20,828 megawatts (MW). By 2030, capacity could expand by 177%, fuelled by the demand for AI and digital transformation. After a 36% decline in transaction volumes in 2023 due to global interest rate hikes, the market rebounded in 2024 with a 118% increase, reaching $31.8b.
Asia-Pacific (APAC) has emerged as the leading region for data centre investment, capturing $15.5b in cross-border investment in 2024. APAC is expected to add 4,174 MW of capacity by 2027, supported by $58.7b in planned investments.
Singapore’s market is seeing a growing focus on smaller, high-value rack transactions rather than large-scale deployments amidst vacancy registering below 1%. Some operators are now securing prices above S$1,315.79 (US$1,000) per rack, highlighting the premium attached to limited capacity in the city-state. Singapore remains one of Asia Pacific’s leading data centre hubs, neighbouring Johor, Malaysia is also attracting increased investment as hyperscale providers seek alternative expansion options.
Stephen Beard, Global Head of Data Centres at Knight Frank, noted the industry’s rapid transformation, emphasising sustainability and strategic location as key factors. Fred Fitzalan-Howard, Head of Data Centres, APAC, highlighted the region’s potential for substantial growth, driven by increasing investor interest and the rollout of AI infrastructure.
The report underscores the importance of navigating regulatory complexities and sustainability requirements to remain competitive in this high-growth sector.
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