India Surpasses Major APAC Countries in Data Center Capacity, Projected to Exceed 1800 MW by 2026
The report observed that DCs rank among the top three preferred alternative assets for investors in the APAC region, including India.
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India has topped major APAC countries with the highest data centre capacity of 950MW in the Asia-Pacific region (excluding China), overtaking major countries like Australia, Hong Kong SAR, Japan, Singapore, and Korea, a report released by real estate consulting firm, CBRE South Asia said. The report added that India is likely to record the highest capacity addition of ~850 MW during the 2024-2026 period, higher than major APAC countries.
After India, Japan recorded the second-highest Data centre (DC) capacity with 892 MW, followed by Australia at 773 MW, Singapore at 718 MW, Hong Kong at 613 MW and Korea at 531 MW, the report added. It underlined the growth of the DC industry, adding that it has doubled since the start of the pandemic. In 2023, there was an addition of 255 MW of new supply compared to 200 MW in 2022, resulting in a total stock of approximately 1,030 MW by the end of the year. This accelerated growth is expected to continue in 2024, with a planned supply of over 330 MW across various cities, potentially increasing the stock by 30% annually to reach around 1,370 MW. The total DC stock in 2023 was 16 mn. sq. ft. in India.
The report observed that DCs rank among the top three preferred alternative assets for investors in the APAC region, including India. The sector has witnessed significant investments from global operators, real estate developers, and private equity funds eager to tap into the country's thriving market. Global investors retain a strong interest in the Indian data centre market, with many groups eyeing partnerships and joint ventures with local operators. M&A activity among operators is likely to pick up in the coming years due to the growing number of players, which should result in some consolidation before the market becomes too fragmented.
The industry has secured investment commitments of more than USD 40 billion from both global and domestic investors, showing the opportunity in the country. The top states that dominated the cumulative investment commitments include Maharashtra, Uttar Pradesh, West Bengal, and Tamil Nadu. India is also attracting global hyperscalers who view it as a prime market for expansion, with many of them opting for their customised build-to-suit (BTS) facilities. In 2023, more than 85% of the USD 27 billion committed will be targeted towards the development of hyperscale facilities, it added.Anshuman Magazine, Chairman & CEO, India, South-East Asia, Middle East & Africa, CBRE, said, "India, with its favourable market conditions, is attracting multinational corporations (MNCs) seeking to expand their digital services and relocate from other Asian markets due to supply constraints. Sustained demand is expected from BFSI firms, technology corporations, and cloud service providers as they explore alternative solutions such as colocation and hyperscale facilities. Furthermore, engineering & manufacturing firms, along with technology companies, are likely to establish their own DCs specifically dedicated to R&D labs."
Mumbai, known for its status as the financial capital and hosting key landing stations connecting India with the Middle East and Europe, remains the dominant market with over 50 per cent of the total stock in India as of 2023, the report observed. Chennai, with an 18 per cent share, follows as the second most popular market due to its strategic location on the east coast, facilitating strong connectivity to East Asia. The report added that more than 60 per cent of the upcoming supply would be concentrated in Mumbai and Chennai, while Delhi-NCR, Bangalore, and Hyderabad are jointly expected to account for over 30% of the total. With the anticipated supply influx, tenants are expected to carefully assess their options, select suitable DC providers, and negotiate favourable terms aligned with their specific requirements. Demand is likely to pick up pace in H2 2024, paving the way for continued growth in this sector. Emerging markets such as Kochi, Jaipur, Ahmedabad, Lucknow, Patna, and Vishakhapatnam are experiencing growth, driven by their strategic locations and improved infrastructure, including enhanced power supply along with fibre and cable connectivity upgrades.
Total colocation data centre capacity currently stands at 1 GW, more than double the figure from 18 months ago. The new data centre supply is projected to reach up to 250MW annually for the next five years. The top occupier categories anticipated to drive demand include cloud service providers, BFSI firms, retail, healthcare, entertainment, telecommunications, and others, according to the report. (ANI)
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)
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- India
- Data center
- APAC
- Real estate
- CBRE
- Investment
- Hyperscalers
- M&A
- Mumbai
- Chennai
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