Malaysia data centre market to enjoy strong growth: Juwai IQI - MIDA | Malaysian Investment Development Authority
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Malaysia data centre market to enjoy strong growth: Juwai IQI

Malaysia data centre market to enjoy strong growth: Juwai IQI

16 May 2023

Malaysia has emerged as a leading player in the global data centre market, attracting billions of dollars of investment from global technology companies, according to Juwai IQI, Asia’s largest real estate technology company.

In the forecast for the data centre market in the country report released yesterday, Juwai IQI co-founder and group CEO Kashif Ansari said the Covid-19 pandemic had altered the dynamics of cloud-based tools.

“The pandemic has made broadband connectivity and cloud-based productivity tools more important than ever in the daily lives of Malaysians. And the reshuffling of supply chains during reduced business travel has made cloud-based tools and services a more critical element of economic growth than before the pandemic,” said Ansari.

He added that these two factors underlie the growing demand for data centres, which make cloud-based services possible. There are already 33 data centres in Malaysia, with at least a dozen more in the development pipeline. Cyberjaya, Kuala Lumpur and Selangor are by far the top locations for data centres, followed by Johor.

“Malaysia has emerged as a top Asia-Pacific region (Apac) data centre market because of supportive government policy, high levels of connectivity, a large population, abundant cost competitive land, inexpensive sustainable energy, and its geographical position at the heart of Asean and next-door to Singapore,” Ansari explained.

The report by Juwai IQI also highlighted the fact that Malaysia has a significant advantage over other markets when it comes to land costs.

Johor and Kuala Lumpur have the lowest land costs among the top markets in Apac. Land in Johor and Kuala Lumpur can be acquired for data centres at about one-quarter the cost of comparable land in the world’s number 1 data centre market, which is northern Virginia, in the US.

“Data centre operators are under constant pressure to reduce their energy usage costs and environmental impact. Malaysia has an advantage in both energy and land.

“Malaysia is attractive because green energy will account for approximately 40% of all power generation by 2035. Also, in other key data centre markets across the globe, utility costs are expected to rise by a median of 16% in the years ahead,” Ansari said.

The report also stated that Australian data centre operator NEXTDC said it will accelerate its expansion plans in Malaysia, and is raising US$419.2 million (RM1.8 billion) in part to do so.

Source: The Sun Daily