APAC Hyperscale Data Center Market Growth Insights – Market Area to Reach 29.28 Million Sq. Ft. and Power Capacity to Exceed 7,354 MW by 2031, Driven by AI Workloads, Hyperscale Cloud Expansion, Digital Transformation, Rising Enterprise Data Demand, and Continued Investments in Large-Scale Data Center Infrastructure (2026–2031)

APAC Hyperscale Data Center Market – Industry Outlook & Forecast 2026-2031

APAC HYPERSCALE DATA CENTER MARKET SIZE & SHARE

The APAC hyperscale data center market size witnessed investments of USD 96.62 billion in 2025 and will witness investments of USD 240.33 billion by 2031, growing at a CAGR of 16.40% during the forecast period. With respect to investment, Southeast Asia (SEA) is slated to contribute around 20% of the overall APAC hyperscale data center market. China recorded the highest hyperscale data center investment in 2025, reaching approximately $11.92 billion, driven by the country's large-scale cloud ecosystem, AI infrastructure expansion, and strong domestic demand for digital services.

Australia and Japan continue to be established hyperscale markets, characterized by robust demand from cloud providers and artificial intelligence (AI) implementations. Nevertheless, power constraints and sustainability requirements are affecting future site-selection strategies. Singapore remains the leading interconnection hub in APAC, but it is facing limitations in land and power availability. As a result, growth is increasingly extending into neighboring Malaysia and Indonesia, while Singapore aims to concentrate on developing higher-efficiency facilities.

The rapid adoption of AI in China is becoming one of the key factors driving data center investments, as AI applications require massive, advanced data center facilities to process and store AI workloads. As of June 2025, approximately 515 million Chinese individuals have adopted AI for their daily operations; this count is expected to further increase in the upcoming years. China aims to increase the share of AI adoption to approximately 70% of the Chinese population by 2027, and to over 90% by 2030.

Geopolitical tensions and regional instability are expected to delay data center construction by disrupting supply chains, limiting material availability, and creating labor shortages. However, the growing need for resilient and localized digital infrastructure is likely to encourage increased investment in data centers across more stable regional markets.

Malaysia continues to emerge as a prime destination for data center investments due to its location between major Southeast Asian markets and robust digital infrastructure. Furthermore, the comparative affordability of land and energy costs, especially when contrasted with neighbouring countries such as Singapore, continues to attract global technology companies to establish and grow their operations in Malaysia.

APAC HYPERSCALE DATA CENTER MARKET TRENDS

Adoption of Sustainability Measures Among Data Center Operators

1. Sustainability and green practices are key drivers of data center investments in APAC. Data center operators are increasingly prioritizing energy efficiency to minimize greenhouse gas emissions, environmental impact, and operational costs, while promoting sustainability across the country.
2. Most of the countries across APAC have set sustainability targets to reduce their environmental impact and become carbon neutral. For instance, Australia has set a national target to achieve net-zero greenhouse gas emissions by 2050 and is therefore increasing its focus on renewable energy generation. The country aims to source over 82% of its electricity from renewables by 2030.
3. Japan aims to achieve carbon neutrality by 2050. According to a new climate plan, the country aims to reduce carbon emissions by 60% and 73% by 2035 and 2040, respectively. The Indian government announced that it aims to achieve the net-zero emissions target by 2070.
4. Indonesia aims to achieve a net-zero carbon emissions target by 2060; hence, it focuses on producing its electricity from renewable sources significantly. The country is committed to generating over 48% of its electricity through renewables by 2030.
5. Taiwan aims to achieve net-zero emissions by 2050. Therefore, the government pushes the use of renewable energy to promote this goal. The renewable energy roadmap states that Taiwan is likely to install 8 GW–14 GW of geothermal, 50 GW–80 GW of solar, and 40 GW–55 GW of wind power by 2050.
6. The adoption of sustainable technologies, such as liquid cooling, free cooling, renewable energy integration, and waste heat recovery, is helping data center operators reduce their environmental footprint. The implementation of these green practices is expected to accelerate across APAC over the next five years.

AI Aids Data Center Growth

1. The adoption of AI in APAC continues to witness significant growth across various sectors, fuelled by the technological infrastructure and focus on innovation in the region. AI is further playing a significant role in enhancing digital transformation across diverse sectors, which include manufacturing, automotive, healthcare, and finance.
2. The governments across the APAC nations are increasingly focusing on AI development and encouraging public and private organizations to adopt AI applications to enhance their operational efficiency and boost productivity.
3. In November 2025, the Taiwanese government announced it had allocated around $3.2 million to make strong AI infrastructure in Taiwan to become a global AI leader by 2040. In addition, this initiative focuses on three main technologies, including photonics, quantum computing, and AI robotics.
4. In August 2025, the South Korean government planned to develop smart power grids to optimize electricity production in South Korea by leveraging AI services. AI is likely to allow smart grids to predict the demand for electricity in the future and predict the amount of renewable energy to be generated to meet the required demand.
5. APAC is accelerating AI development through initiatives such as expanding AI-ready data center infrastructure, strengthening government support, and promoting AI adoption across industries, including healthcare, finance, and technology, to drive digital transformation and sustainability.

APAC HYPERSCALE DATA CENTER MARKET SEGMENTATION INSIGHTS

1. In the APAC hyperscale data center market, the demand for UPS systems is growing due to the increasing investments in data centers. Data center operators are expected to gradually prioritize installing Li-ion batteries in place of traditional lead-acid UPS systems to enhance sustainability. The SY1 facility by Equinix in Sydney and the ME1 facility in Melbourne are equipped with N+1 UPS redundancy.
2. In the APAC hyperscale data center market, most data center facilities are equipped with diesel generators with at least N+1 or 2N redundancy configuration. The demand for HVO-powered generators is expected to increase during the forecast period.
3. Racks are the basic components of data centers that host IT equipment. These racks are available in a variety of sizes, ranging from 36U to 55U, depending on the available elevated floor area. The 42U rack unit is the most used in data centers. Rack units of 45U, 47U, and 48U are mainly installed in large data centers.
4. Air-based cooling techniques in data centers comprise DX-based CRAC units, free cooling technique solutions, air-cooled chiller-based cooling, and dry coolers.
5. The adoption of the liquid cooling technique is emerging as a key trend in the APAC data center market, driven by rapidly rising rack power densities. According to insights from NEXTDC, Vertiv, and NVIDIA, data center average rack densities are expected to grow from approximately 15 kW–25 kW to over 50 kW by 2029. As AI workloads intensify, peak rack densities are projected to reach 250 kW–500 kW, making traditional air cooling insufficient and accelerating the shift toward liquid cooling techniques.

APAC HYPERSCALE DATA CENTER MARKET REGIONAL ANALYSIS

1. China stands out with approximately 22 existing undersea cables that connect China to other countries worldwide such as Japan, Singapore, Malaysia, the Philippines, Taiwan, South Korea, Cambodia, India, Egypt, Qatar, Thailand, the UAE, Vietnam, the US, and others. In 2025, around three new submarine cables were developed in China.
2. Hong Kong is an attractive business destination due to its proximity to mainland China, strong international trade links, and significant growth in FDI, ranking just behind major markets such as the US, the UK, and China. To support the expansion of the data center industry, the government established the Developing Data Centres Unit, intending to make Hong Kong a leading APAC data center hub as well as a key center for technological collaboration and trade.
3. Data center operators in Japan signed renewable energy PPAs for data center facilities. For instance, in October 2025, Microsoft announced the signing of a PPA with Shizen Energy, a Japanese energy firm that offers around 100 MW of solar power in Japan.
4. Mumbai, Navi Mumbai, Hyderabad, Chennai, and Pune are the preferred locations in India data centers, with major investments from service providers such as ST Telemedia Global Data Centres, NTT DATA, Equinix, Sify Technologies, Airtel (Nxtra Data), among others.

Browse Our Country-level Data Center Markets in APAC

APAC HYPERSCALE DATA CENTER MARKET VENDORS LANDSCAPE

1. The APAC hyperscale data center market has the presence of key investors such as AirTrunk, Alibaba Cloud, Apple, AWS, Bridge Data Centres, CDC Data Centres, China Mobile International, China Unicom, DayOne, Digital Realty, Equinix, Google, Keppel Data Centres, Meta, Microsoft, NEXTDC, NTT DATA, Princeton Digital Group, ST Telemedia Global Data Centres, STACK Infrastructure, Vantage Data Centers and others.
2. In April 2026, AirTrunk announced the acquisition of Lumina CloudInfra, marking its entry into India's rapidly expanding digital and AI infrastructure market. Through the acquisition, AirTrunk gains access to Lumina’s development pipeline, established customer and partner relationships, operational expertise, and a planned portfolio of approximately 600 MW of capacity, representing around $5 billion in future data center development opportunities.
3. In September 2025, Alibaba Cloud announced plans to expand its data center footprint across key APAC markets, including Japan, South Korea, and Malaysia, to support growing demand for AI and cloud services.
4. In March 2025, the CURRENC Group announced its plan to acquire around 100 acres of land in Johor for the development of a new 500 MW data center campus. The first phase of 100 MW is slated to become operational by the end of 2026, providing colocation and wholesale leasing to customers.
5. In 2026, Nxera, a data center arm of Singtel, in collaboration with Telkom Indonesia’s subsidiary, NeutraDC, and Medco Power, an Indonesian energy company, is developing Batam Data Center with an IT power capacity of over 54 MW in Batam, Indonesia.