Malaysia has come out on top as the most desired destination for data center investment, according to the latest report by Knight Frank released during the Malaysian Data Center White Paper Launch today.
The South East Asian nation lead with 113MW of take up in 2022 as compared to ranked second Indonesia (22MW) followed by Vietnam (2MW), Philippines (2MW) and Thailand (25MW). The Knight Frank SEA-5 Data Centre Opportunity Index (SEA-5 Index) examines the key markets within the SEA-5 to understand each respective country’s current data centet ranking against its peers.
The growth of Malaysia’s data center sector has predominantly occurred in two key areas, namely Greater Kuala Lumpur (which includes Central Kuala Lumpur and Cyberjaya) and Johor.
In the past ten years, Malaysia has emerged as one of the most vibrant data center markets in the Asia Pacific (APAC) region, thanks to a surge in cloud adoption, government-supported initiatives, and the Singapore data center moratorium.
Indonesia and Malaysia are leading the way as the top providers of space and resources for data center investment, while other competing countries are reportedly facing challenges related to land ownership laws and telecommunications deregulation.
The emergence of cloud service providers opening dedicated cloud regions further spurred the rapid expansion by data center operators in Malaysia. Most recently in Malaysia, Amazon’s cloud computing unit announced that it will be investing $6 billion over the next 14 years. In 2021, Alibaba Cloud, the digital technology and intelligence backbone of Alibaba Group, was appointed as a cloud service provider (CSP) for the Malaysian government.
Although Cyberjaya continues to be the top choice for data center development in the Greater KL area, there has been a growing demand from both customers and operators for new locations such as Bukit Jalil and Petaling Jaya. These locations are attractive because they offer a more reliable power grid and greater location diversification, which is crucial for data center customers seeking to distribute their compute loads across different locations and increase redundancy.
The report further adds that Johor is also a key location for data centers with development areas such as Nusajaya Tech Park, Sedenak Tech Park, and YTL Green Data Centre Park.
