As the world increasingly relies on digital infrastructure, global real estate giants are racing to expand their data center footprints in Japan. Led by Blackstone, the world’s largest data center owner, these companies are aiming to capitalize on the country’s growing demand for cloud services and artificial intelligence (AI) applications.
Blackstone’s recent acquisition of AirTrunk, the largest data center operator in the Asia-Pacific region, solidifies its position as a dominant player in the Japanese market. Nikkei Asia reported that Daisuke Kitta, head of the company’s real estate investment in Japan, expressed the company’s ambition to become a leading provider of data center facilities in the country, “We aim to be a dominant provider of data center facilities in Japan.” said Kitta.
ESR, another major real estate investor, has also entered the Japanese data center market. The company has plans to build multiple data centers in Tokyo and Osaka, driven by the increasing demand for cloud services from global tech giants like AWS, Microsoft, and Google.
The Japanese market’s growing appeal to data center investors is attributed to several factors. First, the country’s aging population and chronic labor shortages make AI a particularly attractive solution for various industries. Second, the recent surge in AI adoption has created a significant demand for data centers to support the computational needs of these applications.
While data center investment has historically been a small portion of real estate investment in Japan, experts predict a significant increase in the coming years. As foreign investors continue to pour capital into the market, the share of data centers in the country’s real estate portfolio is expected to rise to between 5% and 10%.