New M3 Property research shows demand for data centre facilities is rapidly increasing across Australia
Our latest report, Data Centre Growth in Australia, investigates the growing demand for data centre facilities across Australian property markets. The research follows the announcement that Australian data centre firm AirTrunk has been bought out by Blackstone and the Canada Pension Plan Investment Board (CPP Investments) for over AUD24 billion in one of the biggest deals in recent years involving a technology company, reflecting the significant demand for data centres as an asset class.
The report finds that there are currently 135 operational co-location data centres in Australia, with existing centres in Sydney, Melbourne, Brisbane, Perth, Adelaide and Canberra, and an estimated 183,000 square metres of space under construction. Close to three quarters of the new supply will be in Melbourne with the remainder in Sydney. Over the coming decade, further supply is also expected to extend to markets including Canberra and Brisbane, according to the report.
James Ruben, National Director, Specialised Assets at M3 Property, said, “Traditionally data centres have been an ancillary use of office, retail or industrial property. However, this is changing with the rapidly growing demand for data centres in Australia. In addition to data storage, new technologies such as AI and 5G, the growth of e-commerce, data security requirements and the need for companies to provide reliable and secure IT and data services to a workforce that is more likely to work from home is leading to the need for developers to build bigger and more secure purpose-built data centres.”
Despite this demand, the sector is facing issues. “While data centre facilities are seeing increasing demand from both users and investors in major property markets, the sector is also facing several key challenges. These include finding suitable land for new developments, access to adequate and steady power supply, and increasing construction costs,” said Mr Ruben.
View the full report below.
Data Centre Growth in Australia Research Report – September 2024
Time to talk?
With 120+ experts across Australia, our property solutions are as independent as they are extensive.
Confidence and success in property starts by asking the right questions. From valuation and asset advisory to taxation, rating and litigation, our property advice looks beyond the immediate, providing a premium, strategy-based solution.
Related Insights
M3 Property Appoints New Commercial Director in NSW
Edward Hine joins M3 as Commercial Director NSW M3 Property announces the appointed Edward Hine as Director of Commercial, NSW with a focus on Office Markets. With over 14 years’ industry experience in the real estate sector providing commercial and residential valuation advice, Edward has international experience in senior positions in firms in Australia and …
New South Wales Market Snapshot H1 2024
The New South Wales property market has seen steady growth during the first half of 2024 for well-positioned assets with strong income security, rental growth and lease covenants in sectors including Retail, Childcare and Hotels. In the Sydney Office sector, transaction volumes have been low over the past 24 months as increasing interest rates and …
Always independent.
Our independence is a constant source of pride; ensuring we can be truly objective when it comes to our clients’ needs. Start your conversation with us – we're here to listen.