Asia-Pacific is fast emerging as the centre of the global data centre market, but as demand accelerates – fuelled by AI and widespread digitalisation – the real challenge is whether power, cooling and delivery infrastructure can scale fast enough to support it. Alex Saez, Partner in the data centre team and Managing Director of APAC at Cundall, reveals his expert insights.
Asia-Pacific (APAC) is rapidly becoming the focal point of the global data centre market. The region currently has more data centre capacity under development than Europe and is closing the gap with the US. Today, APAC hosts 12.7GW of operational capacity, with a further 3.2GW under construction and 13.3GW in planning. By 2026, total capacity is expected to exceed 17GW.
The growth places APAC at the centre of the global digital economy. It also presents one of the sector’s most complex infrastructure obstacles. Demand is no longer the question; the real challenge is whether power, cooling, planning frameworks and delivery models can scale quickly enough to support it.
The forces reshaping demand
The drivers behind APAC’s expansion are well-established. Governments across India, Singapore, Japan, Australia and Southeast Asia are accelerating national digitalisation programmes, from cloud adoption and digital public services to data-intensive sectors such as AI. Smart City initiatives, specifically in rapidly urbanising markets, are embedding Internet of Things (IoT) technologies into transport, utilities and public infrastructure, all of which rely on resilient, high-availability compute.
Artificial Intelligence has become the dominant catalyst. A decade ago, typical data centre racks operated at 6-10kW. Today, AI workloads routinely require 30-100kW per rack, with the latest Nvidia Blackwell processors exceeding 120kW. These density levels fundamentally change what a data centre is and how it must be designed.
Across APAC, hyperscalers and colocation providers are already responding by rethinking design strategies to prepare for a future in which AI-optimised halls are no longer specialist environments but the norm.
Investment follows demand. In 2024, APAC accounted for four of the world’s 10 largest data centre transactions, signalling long-term trust in the region. Singapore continues as a key market, though power constraints are promoting growth in secondary hubs like Johor, Jakarta and Delhi. Another large market is India, which is expected to reach 3GW of capacity by 2030; however, Malaysia, Indonesia, the Philippines and Thailand are actively developing their regulatory and energy frameworks to attract international operators.
By 2030, analysts estimate that up to 70% of global IT demand will require AI-ready facilities. That shift isn’t just about scale, but about the type of infrastructure needed to support it.
Infrastructure under pressure
While development is accelerating, it is occurring across a region with varying levels of maturity and changing regulations. Power availability remains the most immediate constraint, but grid stability, redundancy and long-term generation capacity are also great concerns. High-density AI environments increase these pressures. Their development demands electrical resilience far above traditional design choices.
Cooling is another challenge. As heat loads increase, air-cooled systems are reaching their practical limits. Liquid cooling, whether direct-to-chip or immersion, is becoming increasingly necessary. These technologies offer new dependencies on water supply, treatment and sustainability planning.
After years of steady improvement, power usage effectiveness (PUE) and water usage effectiveness (WUE) metrics are rising again in many high-density areas. This reflects the unavoidable resource intensity of AI workloads and indicates the need for more holistic approaches to performance.
Regulatory diversity increases the difficulty of delivery. India offers extended tax incentives to encourage investment. Singapore is highly selective in its approach to new developments. Japan is subsidising AI computing as part of its technology strategy. Malaysia and Indonesia are prioritising energy incentives. Each market operates differently and at varying paces. This creates particular constraints and policies that entail careful interpretation. For new entrants, particularly those expanding from Europe or the US, working through this landscape without specialist insight can be difficult.
Applying global expertise with local precision
As the region enters its next phase, global experience is needed. The majority of global operators rely on Plan-of-Record or ‘Reference’ designs. These are standards that have been developed over the course of numerous builds across Europe and North America. These templates are useful as they give operators a path for consistent, fast and predictable delivery at scale.
That being said, they only work when they are adapted to the local market in which they are being deployed. Capacity, environmental constraints, planning processes and supply chains differ widely across APAC. Applying global standards broadly introduces more risk than it reduces. This risk causes delays and increased costs, reducing the benefits of the reference design.
As a result, for APAC to realise its data centre growth, it will need to rely on a global supply chain with decades of experience in other markets. The ability to mobilise globally experienced and locally knowledgeable teams across borders to coordinate delivery when adapting designs will become increasingly valuable. This is because it requires not exclusively technical ability but also cultural awareness and an understanding of local codes, municipality approval processes and market conditions.
Building for the next decade
For operators and investors, the value of global expertise falls into risk management. Facilities built and delivered today must remain viable for workloads that are changing at unparalleled speeds. Understanding where design decisions will affect workloads far in the future is necessary to introduce flexibility into the design and save costs later.
Across APAC, the opportunity is clear. Demand is strong, capital is available and the digital economy continues to expand. But success will depend on applying lessons learned in mature markets with the subtlety necessary for local conditions. Shared industry knowledge at a global level will unlock APAC’s – as well as others’ – data centre pipeline.
