Hong Kong accounts for 54% of 2020 APAC data centre spend
Asia Pacific (APAC) data centre investment is continuing to rise throughout 2020, despite regional political tensions and the ongoing COVID-19 pandemic.
At the heart of the region’s data centre industry, Hong Kong continues to exhibit strong performance, and accounted for 54% of all APAC data centre investment volume in the first half of 2020.
A new report by found that total data centre investment volume in the APAC region was 7.2 times higher in the last two years than between 2015 and 2017, for a total spend of around US$5.7bn.
In spite of the pandemic reducing spending by about 44% year-on-year in the first half of 2020, the report remains optimistic that the industry is showing robust growth, with total transaction volume across the region exceeding $1.4bn.
Hong Kong’s continued prominence in the region is a pleasant surprise for the industry. Recent controversies over data privacy legislation, which has seen several major tech companies and leading data centre providers exit the region in favour of Singapore. In July, Korean tech conglomerate , citing privacy concerns.
The company, which is Korea’s in the country’s cloud market, said that it had decided on the move following the passage of Hong Kong’s new security law, which was passed by the Chinese government earlier in July.
“Naver is relocating a data center that backs up an important set of data from Hong Kong into Singapore to better store and manage users’ data in line with an operational direction toward strengthening data protection,” said a Naver representative on the company’s blog, .
However, other data centre providers like (currently building a ) have been redoubling their commitment to Hong Kong, enticed by its prime location as a data centre hub, as well as its low climate risk and even lower tax rates. China Mobile also secured an industrial government site for HKD 5.60 billion in July, according to Cushman & Wakefield.
"Existing data center demand is supported by banking & finance, insurance, and telecom operators. We expect future demand to be largely driven by leading global cloud service providers such as AWS, Microsoft Azure, Google Cloud, Tencent Cloud, and Alibaba Cloud," commented . "The growing importance of Internet of Things (IoT) applications, the impending 5G network, and fast adoption rates of cloud computing as well as the post-COVID-19 'new' normal are the four major factors driving the surge in demand for cloud storage".
GTR and SEGRO agree first UK data centre facility
SEGRO, a property investment and development company, has announced it has come to an agreement with the European data centre platform, Global Technical Realty (GTR) to construct its first UK-based data centre. SEGRO claims that the facility, which will span a total area of 400,711 sq ft, will be located in Slough and is to become “the largest data centre campus in the UK’s premier data centre and communications hub”.
What will SEGRO’s data centre facility be used for?
Supported by the global investment firm KKR, Global Technical Realty says it will be using the facility’s space on a 25-year term to operate bespoke data centres for high-growth global technology companies. The new facility aims to support the growing demand for third-party data centre provision amid ever-increasing growth in data usage and cloud services adoption.
Franek Sodzawiczny, CEO & Founder of GTR, said: “We are excited to be back in the UK alongside our partner KKR and look forward to working closely with SEGRO to deliver this state-of-the-art data centre campus. The data centre space is a fast-moving one. GTR was established to support its customers in providing a data centre solution wherever in the world there is a demand for it. We are delighted that the UK will become home to our flagship concept”.
James Craddock, Managing Director, Thames Valley at SEGRO, said: “We’re pleased to welcome GTR as the latest data centre operator to our thriving estate and our team of experts look forward to developing a stunning new facility for them and their customers. “Homeworking, data streaming, e-commerce and businesses’ reliance on cloud services have all grown during the pandemic, meaning demand for data centres is unabated.
“Slough Trading Estate is home to Europe’s largest data centre cluster and data centres are increasingly regarded as part of our key national infrastructure given the critical role they play in our daily lives”, he added.
The facility is expected to be delivered in two phases with operations beginning by Q4 of next year. The first phase plans to provide 132,575 sq ft of space phase two will create 268,136 sq ft of space. “Vacant possession of the site delivered to the customer by early 2022”, SEGRO said.
The project is also expected to create around 200 jobs during its construction, and a further 80 permanent roles once completed.