Malaysia, Australia Named Region’s Top Data Center Markets

Asia-Pacific’s data center boom is expected to peak in a handful of countries, according to new data from CBRE.

Data center investment in the APAC market reached a record $11.6 billion in 2025, Real Estate Asia reported, citing CBRE’s 2026 Asia-Pacific Data Center Trends & Outlook Report. Markets with increased power capacity like Malaysia, Australia and India are set to benefit the most as artificial intelligence adoption grows and the need for data centers expands beyond traditional data center hubs.

Investors are adapting to the shifting market, increasingly seeking out greater liquidity and asset-specific exposure, per CBRE. In 2025, company-level transactions involving platforms and data center operating companies in the APAC region totaled $8.3 billion. At the same time, operators are increasingly turning to capital recycling and new fund management strategies to support wider expansion and portfolio diversification.

The Malaysian city of Johor — located across the Straits of Johor from the fellow emerging data center player of Singapore — saw the biggest growth in live data center capacity across the entire Asia-Pacific market in 2025, growing 53 percent year over year. Melbourne followed at 37 percent. By contrast, Singapore and Hong Kong, which previously established themselves as emerging data center hotspots, saw growth between 6 and 8 percent.

Increasing construction costs, drawn-out delivery timelines and power constraints in established markets are driving investors and operators to pursue other options, according to CBRE. This includes built-to-suit developments, infrastructure partnerships and local development alliances.

“Asia-Pacific’s data center market is undergoing a significant reordering,” Ada Choi, CBRE’s head of research for Asia-Pacific, said. CBRE expects the APAC region to remain one of the most important growth markets for data centers in the world with power-packed countries like India and Australia leading the way.

Major U.S. investors see the promise in APAC’s data center market. Last fall, Colorado-based Vantage Data Centers completed a $1.6 billion equity investment in its APAC platform, with part of that investment going to the acquisition of Sedenack Tech Park, a hyperscale data center in Johor.

Brookfield Asset Management is planning to invest $10 billion in Japan alone over the next few years with a focus on data centers and battery storage facilities. In West Asia, Blackstone is looking to expand in the region, inking a $3 billion deal with a Saudi AI firm last fall to build data centers in the Gulf nation.

— Chris Malone Méndez