Investors to Pour More Capital Into Thailand and Asia Pacific Data Centers in 2022


Data Center Investment Surged to New Highs in 2021; More Than Double Previous Year’s Record High


Bangkok – June 29, 2022 CBRE, the leading international property consultant, reported that Thailand’s data center is amongst the sectors to watch in 2022 as regional operators are seen entering the colocation market in Greater Bangkok, Chonburi and Rayong, an area previously dominated by local Thai operators. In addition, this rapid surge in data demand, fuelled by continued growth in cloud computing and social media use, is driving increased investor interest in Asia Pacific data centers, with investment in the sector soaring to record levels in 2021, according to the latest CBRE research.




Mr. Adam Bell, Head of Industrial and Logistics, CBRE Thailand comments, “In recent years, CBRE Thailand has seen the entry of regional operators such as STT and Supernap with facilities that are able to capture and support larger hyperscale requirements. This is in line with the recent increase in investment in digital infrastructure, telecoms and submarine cables, which will provide additional growth momentum to the industry.”


Looking at the regional market, direct investment in the APAC data center sector totaled USD 4.8 billion in 2021—more than double the previous high of USD 2.2 billion in 2020 and surpassing investment volumes for the past four years combined. Transaction volume and fundraising activity is expected to remain robust in 2022, with data centers ranking as the most popular alternative investment for the third consecutive year in CBRE’s recent survey of real estate investor intentions.

Interest in the sector has been underpinned by demand from hyperscale cloud providers for bigger facilities and multiple-site deployments. There were several large portfolio deals in APAC in H2 2021, including DigitalBridge-backed Vantage Data Centers’ purchase of PCCW’s data center portfolio in Kuala Lumpur and Hong Kong, and the acquisition of five data centers in Japan by Digital Edge and Stonepeak Infrastructure.


“There is a considerable amount of capital looking to gain exposure to data centers as investors’ understanding of the sector matures. We have already seen strong growth in recent years and the pandemic-driven digitalization trend has really supercharged interest in the sector. While opportunities will be limited relative to the demand that we are seeing, investors are pursuing the operational route by setting up dedicated platforms to secure higher returns,” said Mr. Tom Fillmore, Director of Asia Pacific Data Center Capital Markets for CBRE.


Vacancy was stable at 14% for Asia Pacific’s Tier 1 markets of Greater Tokyo, Singapore, Sydney and Hong Kong SAR, despite record supply of 305MW in H2 2021. Almost 2,100MW of supply is slated to be completed by 2024, with Sydney constituting 40% of the pipeline. The new additions place Sydney on track to become the region’s largest colocation market by 2024 in terms of data center capacity.




Key report findings:


  • The Greater Tokyo region is expected to see balanced demand-supply despite the completion of 200MW of new supply in H2 2021. Operators seeking geographical diversification outside Greater Tokyo are eyeing Osaka and other regional cities, causing rents to hold steady.

  • Data center rents in Singapore are expected to rise despite the lifting of the moratorium on new data center construction from Q2 2022 that would ease medium term availability. The 60MW per year cap on total capacity for new applications means that Singapore’s supply pipeline will lag other Tier 1 markets in Asia Pacific.

  • Sydney is set to have the largest development pipeline among Asia Pacific Tier 1 markets with newly announced mega projects. Hyperscale and wholesale rents are expected to come under pressure as new capacity, completed in phases, add to growing vacancy.


  • Hong Kong rents and vacancy are expected to hold firm as corporate end-users and hyperscale cloud providers remain on the sidelines while near-term supply remains limited.

“Thailand is expected to see continued interest from regional and global operators in the coming years. This is a developing sector in Thailand and both occupiers and landlords are adjusting their expectations in terms of bringing data center projects to completion. CBRE Thailand is already seeing considerable investor interest in the sector from both local and regional funds in acquiring or being investors in data centers from an early stage of development. We have both local and regional teams to support the growth of the data center market in Thailand,” Mr. Bell added.







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