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Mumbai, 03 August 2021: International Property Consultants, Knight Frank, in their latest Data Centre Report 2021, published in partnership with leading data centre research and analytics platform – DC Byte, evidenced that the data centre market has experienced strong momentum in 2021. The report cited that EMEA (Europe, The Middle East and Africa) markets have seen rise of 4% in uptake in the Q1 2021, to 120 Mega Watts (MW) with a 10% increase in new supply overall, totalling to more than 180MW. In Asia Pacific markets, total supply increased by about 200MW in Q1 2021, reflecting a similar pace to 2020 take up – recorded just over 800MW, making a total supply of 5800MW across the region.

Mumbai registered the sharpest increase supply, with 56MW supply added in Q1 2021, recording total supply at 753MW. Pandemic influenced push for digital services resulted into an acceleration of new supply in 2020 with an additional 252MW or 50% added to its development pipeline. This marked up the total supply to 697MW in the year 2020. Between 2016 and 2019, Mumbai’s IT power capacity increased from 148MW to 456MW.

The Q1 report 2021, which provides comprehensive coverage of 28 key markets, has closely tracked the significant pandemic-driven data usage shift in 2020, which in turn magnified the traditional “buy” cycle and led to record developments in the global data centres market. This year the data shows it is apparent that whilst some markets have kept up with this pace others, mostly Tier II cities, have reported little supply growth in early 2021.

IT POWER MW:

Shishir Baijal, Chairman and Managing Director at Knight Frank India said, “Mumbai is amongst the better-established data centre hubs in the APAC region. The city’s location has a strategic importance as a landing destination for undersea data-cables connecting the east and west. The presence of an established telecom industry in India and the push for digital services during the pandemic has further fuelled the growth of data centres in Mumbai. The rise of emerging markets in APAC has brought Mumbai under the focus of multiple international operators, who wish to establish themselves in this region.”

Market Composition:

With respect to market composition, Colocation wholesales comprised the largest chunk with 126.68MW, accounting for 73% of the overall market. Colocation retailers commanded the supply of 31.42MW registering 18% of the overall supply. Telecom enterprise commanded 8% and 1% by Financial Institutions of the total supply, with 14MW and 2.5MW respectively.

Supply and Take-up:

The digital push from the pandemic has resulted in acceleration of data centre supply in Mumbai. With the addition of 56MW, total capacity now stands at 753MW. With respect to take-up, Q1 2021 recorded 8MW, compared to 44MW in all of 2020. Cloud companies are continuing to develop a substantial cloud network in Mumbai, which is aided by an ongoing stream of demand. This has facilitated the creation of multiple new hyper-wholesale colocation facilities. The increased supply can provide plenty of opportunity for creating a rise in take-up in the near future.

Supply and Availability:

With respect to available capacity, Mumbai recorded little under 600MW of available IT power in Q1 2021, against the total capacity of 753MW. Available IT power includes all Live, Under Constructed and Phased IT power.

Adeline Liew, Data Centres Lead, Knight Frank, Asia-Pacific said, “This growing demand for data is heating up land values for data centre sites in emerging markets like Southeast Asia and India where developers are keen to partner with established data centre operators. These operators are also keen to buy greenfield sites for development led by hyperscale initiatives. In addition, tech firms such as Tencent Cloud have also been expanding aggressively across the region. In response to this trend, Knight Frank has been turbocharging its capabilities with expanded local market intelligence and data-centre specialists in the region.”

In EMEA, the core markets of Amsterdam, Frankfurt, London, Paris and Dublin continued their momentum, yet the trend is towards expansion outside of these markets with Africa poised to become a significant hyper-scale region; highlighted by the level of supply coming online in South Africa and Kenya. Istanbul and Warsaw are also noted as “edge” markets to watch. Development in EMEA’s leading markets has been most notable in Q1 in Dublin with 108MW added which represents 75% of 2020’s new supply. London and Moscow both saw 40MW added, whilst Zurich added 33MW.

In APAC, the total IT MW consumed increased by 5 percent to just over 90MW in the first quarter which is on track to meet the 2020 take up levels of 385MW. Among the top performing markets, Sydney reached half of last year’s take up in the first quarter alone and has already more than tripled last year’s new supply.

EMEA SUMMARY

* London reported 40MW of new supply in Q1 2021

* Dublin continues to be a leading target with 17 percent share of aggregate supply across EMEA – adding 108MW of new supply in Q1, a significant expansion that is 75 percent of 2020’s new supply.

* Zurich reported rapid growth, becoming a hyperscale zone for AWS. Adding just over 30MW, compared with 100MW of supply added in total during 2020, in Q1 2021.

* Moscow supply grew by 18 percent, adding 41 additional MW in Q1 2021

* Based on DC Byte analysis of private equity announcements, Africa is expected to receive a disproportionate level of investment in the coming years.

APAC SUMMARY

* Mumbai recorded the sharpest increase in capacity in Q1 2021, 56MW capacity added

* Hong Kong recorded added significantly to capacity in Q1, with 50MW (compared with 80 added in all of 2020) and take-up of 10MW, more than a third of the take-up in all of 2020.

* Kuala Lumpur made gains in 2021. Total capacity expanded by 8MW. This is a third of 2020’s supply increase, bringing the total aggregate supply to 89MW.

* Expansion in other markets in India, notably Chennai, is gaining attention.

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