APAC Data Center Market to Reach US$255.49 Billion by 2031

● APAC data center market to reach US$ 255.49 Billion by 2031, While Colocation Investment Set to Add US$64.08 Billion.

● Southeast Asia is set to contribute over 21% of APAC’s growth, reinforcing the region’s emergence as a key colocation investment hotspot.

New York, TechnoBusiness Insights US ● The APAC data center market is on track to reach USD 255.49 billion in investment value by 2031, up from USD 126.64 billion in 2025, according to a new report from Arizton Advisory & Intelligence. The market is forecast to grow at a compound annual growth rate (CAGR) of 12.41% between 2026 and 2031, as enterprises across the region accelerate digital transformation, expand cloud adoption, and scale infrastructure to support AI workloads.

Major Investment Highlights Across the APAC Data Center Market

China remains the leading investment market, accounting for approximately 47.92% of regional data center investments in 2025, supported by hyperscale activity and continued digital infrastructure development. India and Australia continued to strengthen their position as major investment destinations.

Japan represented approximately 10.08% of APAC data center investments in 2025, supported by increasing AI deployment and government-backed technology initiatives. Land availability constraints in major hubs such as Singapore, Tokyo, and Sydney are encouraging operators to evaluate secondary markets, including Malaysia, Thailand, Indonesia, the Philippines, Taiwan, and New Zealand for future developments.

Higher-density AI workloads are increasing infrastructure requirements across APAC facilities, strengthening interest in liquid cooling, higher rack densities, and resilient power environments.

Policy Support Is Reinforcing Data Center Expansion Across APAC

Government initiatives are increasingly influencing the pace and location of data center investments across APAC. As countries compete to strengthen their digital economies and attract technology investments, policy support is extending beyond traditional incentives to include AI infrastructure programs, digital sovereignty strategies, and long-term infrastructure development plans. This is creating a more favorable investment environment across several APAC markets, particularly those seeking to establish themselves as regional digital hubs. As a result, government-backed initiatives are becoming an important factor in shaping future capacity additions, alongside power availability, connectivity, and demand from cloud and AI workloads.

The APAC Data Center Colocation Market Set for Sustained Growth

The APAC data center colocation market is entering a major expansion cycle witnessed with data center investments expected to reach USD 64.08 billion by 2031, growing at a CAGR of 15.36% billion between 2026 and 2031. While China continues to anchor the region’s colocation growth, the next wave of momentum is increasingly shifting toward Malaysia, India, and Australia, driven by hyperscale expansion, AI workloads, and rising enterprise cloud demand.

Meanwhile, Southeast Asia is set to contribute over 21% of APAC’s growth, reinforcing the region’s emergence as a key colocation investment hotspot. In terms of power capacity, China remains dominant, although markets such as India, Malaysia, Japan and Indonesia are rapidly scaling infrastructure to meet rising digital demand.

Liquid Cooling Gains Momentum as AI Rack Densities Rise

The growing demand for AI and High-Performance Computing (HPC) workloads is increasing the adoption of liquid cooling technologies across APAC data centers. As rack power densities continue to rise, operators are investing in cooling systems that can better manage heat in high-density environments while improving energy efficiency.

Liquid cooling accounted for around 55.2% of cooling infrastructure investments in 2025 and is expected to reach nearly 59.0% by 2031, reflecting a gradual shift in cooling preferences across the region. The trend highlights a stronger focus on thermal efficiency and lower power and water consumption as APAC data centers continue to scale.●

Text: TechnoBusiness Insights US

Data: Arizton, June 2026

Photo: Pixabay