Singapore most robust nation in Asia-Pac for data centre operations: Cushman & Wakefield
Singapore
SINGAPORE has been rated Asia-Pacific's top location for data centres in a report by Cushman & Wakefield.
A risk index run by the global real estate services firm has ranked Singapore as the most robust market for the business operations of data centres.
Singapore's score of 84.5 out of 100 was ahead of South Korea's 83.23, Hong Kong's 78.73, Japan's 76.48 and Australia's 68.18, the report, which was released this week, showed.
The Cushman & Wakefield's Data Centre Risk Index takes into consideration top factors influencing the host-country risks for data centre operations. These include criteria such as energy, internet bandwidth, ease of doing business, political stability, natural disaster and energy stability.
Singapore performed strongly on network infrastructure, diverse connectivity to major APAC (Asia-Pacific) markets and its pro-business environment and political stability, the report said.
The report noted that Singapore tops the region in terms of data centre capacity, with a total supply of 370 megawatts (MW) of IT power supply among co-location operations.
Singapore, as the leading data centre nation in APAC, has also expanded its capacity by another 130MW since early 2015.
Cushman & Wakefield projected that Singapore would be able to expand this capacity by another 100MW on the back of its Smart Nation initiative.
This will benefit local data centre providers such as Singtel, Keppel Data Centres and ST Telemedia.
The expansion in Singapore's data centre capacity has come on the back of an explosive growth in data creation and storage.
Cushman & Wakefield Singapore's head of research, Christine Li, said that 90 per cent of the world's data was created only in the last two years. Over 2.5 exabytes, or 2.5 billion gigabytes, of data are generated daily worldwide in this digital age in the form of emails, documents, presentations, images, videos and voice recordings.
Ms Li said that data centres thus far "serve as the backbone of systems that facilitate the swift transmission of data 24 by 7".
She viewed the explosive adoption of smartphones and cloud services in APAC, coupled with a lack of suitable locations and quality data centre spaces, as contributing to heightened interest in data centre investments in Singapore. "This trend is likely to continue," she added.
Cushman & Wakefield estimates that data centre supply in Singapore will grow by 15-18 per cent in the next year and data centre occupancy rates here will reach 70 per cent by the end of 2018.
One possibility data centre operators here have tapped to fast-track capacity growth is the conversion of brownfield industrial properties.
Cushman & Wakefield's associate director of Data Centre Advisory Group, Lynus Pook, noted that five such conversions over the last 10 years make up less than 15 per cent of the existing tier 3 data centre supply.
Mr Pook said that though such brownfield conversions can shorten the construction period and reduce construction risk, not all existing industrial properties can meet the criteria for conversion into a data centre.
He estimated that industrial properties meeting the criteria may command a 20 per cent premium over market valuation.
