According to a recent study by Knight Frank, Mumbai has emerged as the third-largest data centre market in the Asia-Pacific (APAC) region with a total capacity of 2,337MW. It is the only city representing India on the list. The live capacity stood at 270MW with over half of the total capacity in the early stage at 1,272MW. 11.55 per cent of its total capacity is in the live segment.
As per the report, Mumbai added over 328MW of capacity, spurred by announcements from existing players and a new market entrant, Digital Edge. Compared to previous quarters, supply movements have moderated, with over 40 per cent of its current live capacity absorbed throughout 2022.
The analysis focuses on nine markets in the APAC region, namely Tokyo, Shanghai, Sydney, Singapore, Hong Kong, Mumbai, Seoul, Kuala Lumpur and Bangkok. Total market capacity recorded in Q1 2023 across all nine markets has tipped over 13,400MW. Robust growth trajectories among the key data centre markets in APAC continue, with total market capacity – which includes both live and pipeline (under construction, committed and early stage) capacity – across the featured markets cumulatively increasing by 425MW since the start of 2023. The majority of this growth in supply was fuelled by market expansions recorded in Mumbai, as well as new capacity announcements stemming from Bangkok, Kuala Lumpur and Tokyo.
The study states that supply in Bangkok has grown by a third since the beginning of 2023. The market experienced a busy quarter amidst announcements and ground-breaking events of new projects. Following a marked uptick in absorption in 2022, market players continue to grow exposure to the asset class, with operators seeking to expand capacities at varying sites in the city. New announcements in Kuala Lumpur likewise fuelled growth in the Southeast Asian market. The supply expansion recorded in Q1 2023 was a third of the total supply added to the market in the previous year. Cloud service providers have been active in establishing a presence in Malaysia’s capital city, with Amazon Web Services having announced plans to develop in the area this quarter.
Tokyo also saw over 50MW of capacity added to the market in Q1. Interest in the Tier 1 market continues to flourish, two years after the market evolved beyond the two-gigawatt mark. Market activity in recent quarters has been fuelled by works on numerous pipeline projects, particularly those owned by international operators such as ST Telemedia and STACK Infrastructure. In February 2023, AirTrunk held a ceremony for the next phase of development at its TOK2 hyperscale campus. Overall, positive trajectories persist across established and hypergrowth data centre markets in the region, building off the momentum in market growth as observed over the previous four quarters.
According to Shishir Baijal, chairman and managing director, Knight Frank India, the data centre sector has witnessed a remarkable acceleration in recent years, driven by the exponential growth of internet usage across commerce, social media, entertainment, and cloud adoption. As data centres gain prominence as an asset class in the country, investors are leveraging various strategies such as mergers and acquisitions, joint ventures, and land acquisitions to tap into this sector.