UAE Data Center Colocation Market - Supply & Demand Analysis 2025-2030

UAE DATA CENTER COLOCATION DEMAND AND SUPPLY HIGHLIGHTS

The UAE data center colocation market size was valued at USD 448 million in 2024 and is expected to reach USD 1.73 billion by 2030, growing at a CAGR of 25.33% during the forecast period. The UAE is one of the established data center colocation markets in the Middle East region, hosting around 34 existing data center facilities. Most of the data centers in the country are in Abu Dhabi and Dubai because of the cities’ digitalization efforts, efficient network infrastructure, and enhanced digital connectivity. Abu Dhabi hosts approximately 10 existing colocation facilities, and around 21 existing data centers are in Dubai. The other cities, such as Ajman, Sharjah, Al Ain, and others, are also gaining momentum for the development of data centers in these years in the UAE.

The presence of several cloud companies such as, Alibaba Cloud, Amazon Web Services, Microsoft Azure, and Oracle Cloud, along with rapid surge in the adoption of artificial intelligence, big data, Internet of Things, increasing submarine and terrestrial cable development, deployment of 5G connectivity, rapid digitalization, smart city advancements, and other factors will increase the demand for digital infrastructure in the country in the forecast period leading to rise the demand for the development of new colocation data center facilities across multiple locations of the UAE in the upcoming years.

Various sectors, such as cloud, IT, telecom, government, enterprises, and others, contribute to generating significant demand for colocation services in the Middle East. This demand from several sectors, including enterprises, telecom, and government, is expected to decline in the forthcoming years as the companies operating under such sectors are continuously migrating their non-critical data and workloads to the cloud platforms to leverage advanced technologies and enhance their operational efficiency. The cloud sector will contribute significantly to the growth of the UAE data center colocation market in the upcoming years.

Factors such as extreme temperatures, water scarcity, regulatory challenges, plenty of desert land, and increasing security threats are hampering the UAE data center colocation market growth. To address such issues, the government of the country is taking several initiatives, such as establishing Free Trade Zones and industrial parks across several locations of the UAE, promoting the adoption of renewable sources to power data center operations, and introducing regulations like the country’s National Cybersecurity Strategy to mitigate the impact of these concerns and support data center growth.

The UAE is at the forefront of smart city projects. For instance, according to the IMD Smart City Index 2024, Abu Dhabi and Dubai have secured 10th and 12th ranks, respectively. Furthermore, some of the prominent colocation providers in the UAE data center colocation market include Khazna Data Centers, Gulf Data Hub, Equinix, Moro Hub, e& UAE, and others. The country is also witnessing the entry of several new entrants to address the growing demand for colocation services in the country. In 2024, Pure Data Centres Group and XDS DATACENTRES set footprints in the UAE data center colocation market with the establishment of their data centers in the country.

The operators in the UAE data center colocation market are investing significantly to develop advanced data center facilities, which feature high-density racks, advanced liquid cooling technologies, higher IT power capacities, and clusters of GPUs to support artificial intelligence and high-performance computing workloads. For instance, the AUH7 data center facility, which is being developed by Khazna Data Centers in 2025, has been designed to host racks that can support densities of over 50 kW to 60 kW per rack.

In June 2025, Khazna Data Centers and NVIDIA partnered for the development of multiple AI factories across several locations in the Middle East, including in the UAE. As part of this partnership, NVIDIA has certified the design of next-generation data center facilities of Khazna Data Centers to support NVIDIA Blackwell architecture.

The UAE is committed to increasing the share of renewable sources to around 50% of the total energy mix by 2050 to reduce its carbon emissions, and Dubai has announced its plans to reduce the city’s carbon emissions by 50% by 2030. Several colocation companies, including Khazna Data Centers, Moro Hub, e& UAE, Pure Data Centres Group, du and others aims to achieve carbon-neutrality by 2050, aligning with the country’s broader sustainability goals to achieve carbon neutrality by 2050.

WHAT'S INCLUDED?

1. Transparent research methodology and insights on the industry's colocation of demand and supply.
2. The market size is available in terms of utilized white floor area, IT power capacity, and racks.
3. The market size available in terms of Core & Shell Vs Installed Vs Utilized IT Power Capacity, along with the occupancy %.
4. The study of the existing UAE data center industry landscape and insightful predictions about industry size during the forecast period.
5. An analysis of the current and future colocation demand in the UAE by several industries.
6. Study on the sustainability status in the country
7. Analysis of current and future cloud operations in the country.
8. Snapshot of upcoming submarine cables and existing cloud-on-ramps services in the country.
9. Snapshot of existing and upcoming third-party data center facilities in the UAE
10. Facilities Covered (Existing): 34
11. Facilities Identified (Upcoming): 23
12. Coverage: 5+ Cities
13. Existing vs. Upcoming (White Floor Area)
14. Existing vs. Upcoming (IT Load Capacity)
15. Data Center Colocation Market in the UAE
16. Colocation Market Revenue & Forecast (2024-2030)
17. Retail Colocation Revenue (2024-2030)
18. Wholesale Colocation Revenue (2024-2030)
19. Retail Colocation Pricing along with Addons
20. Wholesale Colocation Pricing, along with the pricing trends
21. An analysis of the latest trends, potential opportunities, growth restraints, and prospects for the UAE data center colocation market.
22. Competitive landscape, including industry share analysis by the colocation operators based on IT power capacity and revenue.
23. The vendor landscape of each existing and upcoming colocation operator is based on the existing/ upcoming count of data centers, white floor area, IT power capacity, and data center location.