With Johor and Greater KL operationally stressed and highly saturated, respectively, the next logical path of least resistance for new investors is Negeri Sembilan, an adjacent state, writes Sr (Dr) Samuel Tan.
Negeri Sembilan is rapidly emerging as a “secondary hub to complement Greater KL (Klang Valley) and Johor in the data center sector. Its main advantage is being a spillover beneficiary of the Klang Valley. As land and power become harder to secure in Cyberjaya and Kuala Lumpur, Negeri Sembilan, a state adjacent to the Klang Valley, offers immediate proximity to these business and industrial hubs at a lower cost.
Klang Valley is highly saturated in terms of land and power grid density. New projects are increasingly forced into fringe areas like Elmina or Bukit Raja, or moving south into Negeri Sembilan.
In Johor, the data center (DC) space is not physically saturated but operationally stressed. In late 2025, Johor began tightening approvals, specifically moving away from Tiers 1 and 2 DCs that consume excessive water without high economic value.
The market is still growing (projected to be 60 per cent of Malaysia’s capacity by 2030), but the easy approvals are over, making Negeri Sembilan the next logical path of least resistance for new investors.
Favourable factors
Unlike other states, Negeri Sembilan (aka NS) maintains a healthy reserve margin of about 16.2 per cent (as of 2024). Furthermore, the state is pioneering a self-sufficiency model. For example, Gamuda is building a 65 MLD water treatment plant (WTP) specifically to support data center campuses, with 25 per cent of the capacity shared with the local community.
Negeri Sembilan is well-integrated into the national grid. The new wave of data centers (DCs) in the state is focusing on Green DCs that incorporate renewable energy and battery energy storage systems (BESS) to mitigate grid strain.
While Negeri Sembilan is smaller in land area than Johor or Selangor, it possesses large undeveloped brownfield and greenfield sites within the MVV 2.0 region specifically zoned for industrial use, making land acquisition smoother than the fragmented plots often found in Selangor.
Furthermore, the state government is moving towards a controlled growth policy to avoid issues seen in other states. The Chief Minister has stated that future approvals will be “cautious”, focusing on Tiers 3 and 4 facilities that meet strict Environmental, Social, and Governance (ESG) standards.
The state leverages federal frameworks like Malaysia Digital (MD) status, which offers tax exemptions, but adds local ease-of-doing-business facilities through the Invest Negeri Sembilan agency.
Data center policies now require developers to contribute to state utility infrastructure, for example, building their own WTPs rather than solely relying on existing public resources.
Where in NS?
Three primary areas have emerged as data center magnets, largely driven by the Malaysia Vision Valley 2.0 (MVV 2.0) growth corridor. The hotspots to watch out are Nilai (Enstek/Nilai Impian), Bandar Springhill/Lukut in Port Dickson, and Sendayan/Seremban.
The current frontrunner is Nilai which is located closest to Kuala Lumpur International Airport (KLIA) and the Klang Valley. It is already seeing construction from US-based multinational corporations (MNCs) as well as the massive Nexus Campus in the Negeri Sembilan Semiconductor Valley.
Bandar Springhill/Lukut became a hotspot due to Gamuda’s large-scale land acquisition of 389 acres. Its coastal proximity is strategic for future subsea cable landings or dedicated utility infrastructure.
There are many established industrial parks in Sendayan/Seremban like Sendayan Techvalley, which provides “plug-and-play” infrastructure that appeals to secondary service providers and tech-adjacent industries.
Among the notable DCs in Negeri Sembilan are a green data centre developed by US investors in Nilai, while the Gamuda Data Centre Campus is an AI data centre in Bandar Springhill, Port Dickson. Earthworks and enabling works are underway as of January 2026.
Nexus Yang Green Data Centre is a major 350 MW, AI-ready, and renewable-powered facility in NS’s Semiconductor Valley. It is developed by Vena Nexus from Vena Group. This project is expected to be completed by the first quarter of 2027.
Negeri Sembilan Semiconductor Valley (NSSV) AI Data Centre (Parcel F) is at the planned/predevelopment stage. This project with investment from Australia is expected to kick off in 2026, with the first phase costing RM10 billion.