Malaysia wraps up 2024 as leading data centre hub in sea with US$23 billion in investment
23 Dec 2024
Malaysia has risen to the top in the region solidifying its position as Southeast Asia’s leading digital hub securing RM141.72 billion in digital investments in the first ten months of the year—three times 2023’s total.
Knight Frank Malaysia released its Data Centre Research Report 2024, bringing together key insights in a single report, showcasing Malaysia’s dominance in the SEA-5 Data Centre Opportunity Index. Ranking first in the index for the second consecutive year, Malaysia recorded a significant annual take-up of 429 MW, outperforming regional peers. This growth is driven by strategic investments from tech giants like Microsoft, Amazon Web Services (AWS), Google, and Oracle, totaling USD 23.3 billion.
Keith Ooi, Group Managing Director of Knight Frank Malaysia, stated, “Malaysia’s strategic efforts in digital infrastructure are not just a blueprint for the region but a call for global players to seize this unparalleled opportunity. The country’s commitment to technological innovation and sustainability makes it a preferred destination for data centre investments and a model for economic resilience.”
Amy Wong, Executive Director of Research & Consultancy at Knight Frank Malaysia, added, “Malaysia’s position at the top of the SEA-5 Data Centre Opportunity Index for two consecutive years underscores its regional leadership in the data centre industry. With an impressive annual take-up of 429 MW and a GDP growth forecast of 5.5% for 2025, Malaysia’s robust infrastructure, strategic investments, and forward-looking policies continue to set it apart. This dominance not only reinforces Malaysia’s competitive edge in Southeast Asia but also signals the nation’s readiness to sustain long- term growth in the digital economy.”
The Malaysian government’s proactive measures, including the Green Lane Pathway and the Corporate Renewable Energy Supply Scheme (CRESS), are instrumental in shaping a resilient data centre ecosystem. By significantly reducing timelines for electricity supply and promoting renewable energy adoption, these initiatives have not only enhanced Malaysia’s infrastructure readiness but also underscored the country’s commitment to sustainability and technological advancement. Chelwin Soo, Director of Land & Industrial Solutions at Knight Frank Malaysia, remarked, “As the world leans into green innovation, Malaysia’s leadership in renewable energy and sustainable data centres sets a precedent for responsible technological growth.
By fostering strategic partnerships between real estate developers, data centre operators, and supply chain companies, Malaysia is creating a dynamic ecosystem that drives industry evolution. The synergy between public initiatives and private innovation positions Malaysia as a magnet for industrial growth, unlocking vast opportunities for both local and global players in the years to come.”
Justin Chee, Executive Director of Valuation & Advisory at Knight Frank Malaysia, noted, “As our data centre industry transitions into a stabilisation phase, the focus on sustainability, energy efficiency, and innovation will define its future trajectory. Notably, Johor has emerged as a key player, surpassing Klang Valley in IT capacity and driving substantial land transactions for large-scale data centre developments. The exponential growth in Johor, particularly in areas like Kulai and Iskandar Puteri, is attracting major international operators and creating significant opportunities for land acquisitions and partnerships.” Chee further added that, “Meanwhile, Klang Valley continues to evolve, with a strong pipeline of large-scale data centres such as those planned by Google and AWS.
By striking a balance between regulatory frameworks, technological advancements, and strategic land acquisitions, Malaysia is well-positioned to lead the way in sustainable data centre growth across the region.”
The report paints a promising picture of the data centre industry, showcasing its potential to drive economic growth, create high-value jobs, and lead the way in sustainable practices. As Malaysia continues to solidify its position in this vital sector, the collaboration between government, industry players, and educational institutions will be essential in fostering a thriving data centre ecosystem.
Source: Business Today
