A data centre. Thanks to low price, HCM City is ranked among top markets in the land price category for data centre development. (Photo Courtesy Cushman & Wakefield) In an annual report by Cushman & Wakefield, the company said that with manyof the largest markets in the APAC region boasting particularly high landcosts, only HCM City ranks within the top 10 for the land price category.
The rest of the top ten markets in the category are: Columbus, Santiago,Johannesburg, Atlanta, Nashville, Phoenix, Austin, Denver, and Chicago.
The report ranks major data centre markets around the world according to 13weighted categories, including market size, fiber connectivity, power cost andenvironmental risk, to determine the top overall markets as well as the topperforming markets in each category.
According to the company’s latest forth quarter of 2022 HCM City marketbeatreport, the average rental price reached 159 USD per sq.m per lease cycle, up 3%quarter-on-quarter and 10% year-on-year.
Vietnam may be a frontier data centre market at this juncture but it hasnumerous fundamentals that would suggest great potential for development goingforward. The country currently has 70% internet penetration, with an estimated29 million people yet to get online.
Over 48% of Vietnam’s capacity is located in the centre of HCM City. Currently,only a small number of multinationals require high-level capacity.
The common approach for international operators is to partner with localtelecommunication operators. There is a sizable lack of existing infrastructurerelative to the population of the market and demand for internet services. Thisrepresents a major opportunity at both the content provision and infrastructureestablishment level.
According to Cush & Walkfield, south of HCM City is preferred as a hub fordata centres, especially for cloud services platform providers, due to latencyissues and the securing of manpower. CMC Telecom opened its Tan Thuan Data Centrein August last year. The facility was designed by B-Barcelona of Singapore. Thefacility has a total area of 13,133sq.m and was 30% pre-leased at launchaccording to CMC.
Australian edge data centres firm Edge Centres has expanded into Asia with thedeployment of their first data centre, EC51, in Vietnam in HCM City incollaboration with the Vietnam National University. They also have plans for anadditional edge site in HCM City.
GAW Capital acquired greenfield land in the Sai Gon Hi-Tech Park in the city.The data centre is expected to be over 18,000sq.m and support 20MW incapacity.
Viettel, a Vietnamese telecommunications company, announced plans to build anew data centre with 260 million USD in investment. While specifics on thefacility have yet to be announced, this would be Viettel’s third project in thecity.
Competition for sites between both data centre players and other asset classeshas reached a fever pitch over the course of the past year. Fulfillment centresand large-scale single family rental developments have been evaluating similarsites as data centres.
According to the company, one notable advantage that data centres have incompetition for these sites is the limited impact on surrounding traffic andparking availability, a key area of concern for a number of local communities.However, data centres do require a higher power draw, and there have seengreater local community concerns about the potential effect on electricalgrids. The growth of edge data centres has continued, optimising workload forlatency./.
VNA
