Malaysia, Thailand & Japan lead Asia Pacific data centre growth

Malaysia, Thailand and Japan are forecast to register the fastest improvements in data centre capacity per capita across Asia Pacific up to 2030, based on new analysis from Cushman & Wakefield.

The Asia Pacific Data Centre Investment Landscape report has found that Malaysia leads the region in the rate at which its population-per-megawatt ratio is set to decline, indicating considerable progress in aligning data centre infrastructure with population needs. According to the report, Malaysia's current figure of over 60,000 people per megawatt of operational colocation data centre capacity is projected to fall to about 14,000 people per megawatt by 2030 – an approximately 80% improvement based on present-day data.

Malaysia's standing as a data centre market has shifted in recent years. Previously viewed as an overflow market for companies unable to use data infrastructure in neighbouring Singapore, Malaysia now serves not only domestic demand, particularly from Kuala Lumpur, but also regional requirements centred in Johor, catering to increased needs in artificial intelligence and cloud services.

Regional benchmarks

The report's data shows that other Asia Pacific markets are also undergoing notable changes. Thailand emerges as the second-fastest consolidating market in the region, with its ratio expected to decline by around 70%. The amount of people served per megawatt will drop from nearly 800,000 to about 220,000 by the end of the decade. Although this drop comes from a relatively low installed capacity base of 89 MW, interest in the sector has grown following the announcement in 2024 of new hyperscaler investment plans.

Japan is identified as having the third-fastest rate of consolidation. The nation's population-per-megawatt ratio, currently at 94,000, is forecast to decrease to 30,000 by 2030. The report attributes this trend to several national factors, including Japan's long-standing attraction for international investors, political stability, a sizeable and affluent population, and its status as the world's fourth-largest economy by GDP.

Global comparisons

"Most Asia Pacific markets remain significantly underserved by data centre infrastructure, with an average of over 350,000 people per megawatt of data centre capacity. In contrast, the United States has a ratio of around 30,000 people per megawatt. This ratio underscores the ongoing efforts in many markets to scale up infrastructure to meet the demands of economic and demographic expansion."

Report author and Head of Insights and Analysis for Cushman & Wakefield's Asia Pacific Data Centre Group, Pritesh Swamy, commented on the disparities highlighted in the report. He noted that most Asia Pacific markets are still catching up to international benchmarks regarding the accessibility of data centre resources.

Influences on growth

The Cushman & Wakefield report considers a range of factors influencing data centre investments, including projected rent revenue, yield-on-cost, capital expenditure requirements and expected demand for new developments, alongside GDP growth figures.

On the correlation between data centre sector development and economic maturity, Swamy said:

"As well as population drivers, the development of the sector is also correlated to economic maturity. Economies with a GDP exceeding US$1 trillion are expected to remain the primary growth hubs over the next 3 to 5 years."

The study found that while population scale plays a crucial role in driving demand for infrastructure, markets with advanced economic structures and higher GDPs remain attractive for significant investment activity in the near term.

Market outlook

According to Cushman & Wakefield, continued data centre growth in Malaysia, Thailand and Japan reflects ongoing changes in the regional technology landscape. Malaysia's consolidation and expansion of data centre services, in particular, positions the country as a key market for domestic and cross-border data needs. Thailand's growing attention from hyperscale operators and investors indicates strengthening interest in Southeast Asian data centre capacities, whilst Japan's mature investment landscape sustains its steady expansion in the sector.

The report draws on data from the International Monetary Fund and Cushman & Wakefield internal research and does not provide investment advice, but aims to contextualise capacity improvements within broader demographic and economic trends in the region.