On September 28, the South Korean government unveiled a blueprint to become a global leader in digital innovation with the goal of becoming the the world’s third most digitally competitive by 2027.
Some recent developments point to the above-mentioned goals that the country has set for itself. Earlier this week, South Korea’s Bosung Group obtained an investment of $2 billion from TGK Inc., for its planned construction of the country’s largest data center.
TGK is a joint venture between Diode Ventures LLC, a US construction engineering company, and Korean energy and infrastructure adviser EIP Asset Management. US engineering company, Black & Veach, which is focused on data centers, owns 100% of TGK.
As a part of the deal, Bosung is building Solaseado, a residential-industrial complex on 20.9 million square-meter land in Haenam, South Jeolla Province. The domestic data center market in South Korea is witnessing strong growth.
According to market reports, by 2026, the South Korean data center market will have investments amounting to USD 5.2 billion, at a Compound Annual Growth Rate (CAGR) of 7.72% starting from 2021. Research firm Arizton estimates that South Korea’s data center market is expected to grow at an annual average rate of 6.7% from 2022 to $5.8 billion by 2027. According to the Korea Data Center Council (KDCC), the number of domestic data centers is expected to increase from 156 in 2020 to 188 by 2025.
Building 5 DC’s
This optimism is reflected in the plans of Bosung. As a part of the deal, Bosung also plans to build five 40 MW data centers starting from next year, according to a report by Korea Economic Daily. Currently, the largest data center in Korea has a capacity of 190 MW under construction near Seoul.
Once the combined 200 MW data center – Korea’s largest – is completed, Bosung expects to attract about 200 related companies, including information technology (IT) firms and create 5,000 jobs.
To date Bosung’s investment could be the largest in the country. Earlier this month, STACK, a digital infrastructure provider and a leading data center company, teamed up with ESR Group Limited, APAC’s largest real asset manager to develop a 48MW data center site in Incheon, Korea. Read more
On June 8, 2022, data center service provider ST Telemedia Global Data Centres (STT GDC) announced plans to construct a second data center site in Gasan-dong, Seoul. This data centre site is set to comprise 31, 205 square metres of gross floor area and deliver a development potential of 30 megawatts of IT power.
Similarly, Singapore-headquartered company, Empyrion DC, unveiled a ready-to-commence green project in the Gangnam district of Seoul. Through employing in-house expertise in energy management and forefront technology, the project is poised to meet world-class energy standards.
At the heart of all this is the Digital New Deal initiative by the government in 2021. This aims to spearhead the nation’s digital transition, with the goal of generating 903,000 new jobs by 2025. Comprised of 12 objectives spread across four sectors, targets include establishing smart healthcare and developing digital infrastructure within the educational sector.
The policy has resulted in growing demand by companies for further digital infrastructure, as the country continues to solidify its place as a major technological hub in the region. As the saying goes: “Well begun is half done”. Now it is time for the remaining half to be completed.