GDS Holdings, the largest carrier-neutral data center operator in China, today announced the first step in the expansion of its portfolio to Southeast Asia with plans to develop a hyperscale data center campus in Johor, Malaysia – a state which borders Singapore. Specifically, GDS Holdings has agreed to acquire greenfield land in the Nusajaya Tech Park in Johor, which is an industrial site owned by CapitaLand.
Notably, Johor Bahru, the capital of Malaysia’s state of Johor, connects via a 0.65-mile (1 kilometer) bridge to Singapore, making it within closer proximity to the Singapore market, than Malaysia’s own capital city, Kuala Lumpur, which sits ~185 miles (~300 kilometers) away. Indeed, the situation of GDS’ Malaysia site allows the company to offer data center services for customer requirements in Singapore.
Recall that Singapore currently has a moratorium on new data center developments, inhibiting GDS’ ability to build directly in the country.
Johor, Malaysia Data Center Development – GDS Holdings
GDS will develop the Johor, Malaysia site into a data center campus with 54 megawatts of total IT power capacity. The facility will span a total net floor area of 242k sqft (22.5k sqm). Phase 1 of the development has an IT power capacity of 18 megawatts, with completion set for early 2024.
GDS is positioning the Nusajaya data center to meet regional demand from the city of Johor Bahru, Malaysia as well as to the more established data center hub in Singapore.
Malaysia’s state of Johor has only a limited supply of new data center capacity (see below). Therefore, GDS Holdings’ new data center campus will target hyperscale customer requirements. In particular, GDS’ largest clients, which include Chinese cloud service providers and internet companies Alibaba and Tencent, are seeking to expand their presence in Malaysia and Singapore.
Malaysia – Data Center Market – GDS Competitors
Most of Malaysia’s data center capacity built to-date has been focused on servicing Malaysia’s capital city, Kuala Lumpur. However, Johor is becoming an emerging hub particularly as Singapore has imposed limitations on new data center capacity.
In addition to GDS, Johor, Malaysia also has a presence from Microsoft Azure (a potential customer for GDS) and VADS, a division of Telekom Malaysia, a telecommunications company.
Keppel Data Centres and the Alpha Data Centre Fund, which is also Keppel-controlled, are developing a build-to-suit (BTS) data center in Johor, Malaysia for Microsoft Azure. This data center forms part of Microsoft Azure’s newly launched Bersama Malaysia data center region. As of August 2020, Microsoft’s Johor data center was 40% complete.
VADS (Telekom Malaysia)
VADS, which is part of Telekom Malaysia, operates the Iskandar Puteri Core Data Centre. This facility has 20 megawatts of power capacity across 350k sqft of gross floor area.
Kuala Lumpur, Malaysia
International data center operators including NTT, Chindata, and Keppel DC REIT serve the greater Kuala Lumpur area. In addition, local providers including Regal Orion (Labu), AIMS Data Centre (Cyberjaya), and VADS, part of Telekom Malaysia (Cyberjaya) also serve requirements in Kuala Lumpur. Finally, Alibaba Cloud has two availability zones in Malaysia which are both located in the city of Kuala Lumpur.
NTT Global Data Centers
NTT’s Cyberjaya Campus currently comprises five data centers in Malaysia. In aggregate, these facilities offer 4.0k+ racks of power capacity.
Chindata Group (NASDAQ: CD)
Chindata operates one hyperscale data center in Cyberjaya, Malaysia (MY0102), which has 20 megawatts of IT capacity. Additionally, the company is constructing one additional data center in Malaysia (MY03). This facility will have 16 megawatts of IT capacity and will be ready for service in Q3 2022.
Chindata notes that Microsoft is a client for its data center services in Malaysia.