Investor demand for Asia-Pacific data centers remained strong in the second half of 2021.
User demand was largely driven by recent government regulations on data storage, security and sovereignty. China’s Data Security Law, effective September 1, 2022, has prompted corporations to construct new facilities to store all locally generated data in market. Eager to capture the growing demand, hyperscale cloud service providers and third-party operators announced plans to expand in H2 2021, establishing new facilities and availability zones across the region. New entrants included Stack Infrastructure (backed by IPI Partners), Flow Digital Infrastructure, PAG Real Estate and Evolution Data Centres. Announced new market locations included Mainland China and Hong Kong SAR, signaling a continued broadened perspective and adoption of the Asia-Pacific region as a whole.
Total Asia-Pacific data center investment volume was a record $5 billion in 2021, with $3.2 billion of that activity in the second half of the year alone.
Mainland China accounted for the highest share of total investment volume. Noteworthy transactions included the acquisition of a 50% stake in the Songjiang Internet Data Centre in Shanghai by GLP, as well as GDS’s purchase of a data center in Beijing from CITIC Group. The largest transaction of 2021 was the acquisition of Hong Kong-based PCCW by Vantage Data Centers.