Planned investment in ANZ data centres to exceed $100m+ over next three years

Over half (60 per cent) of investors surveyed by consulting firm Alvarez & Marsal (A&M) are intending to invest more than AUD 100 million into data centres in the next three years.

The research, conducted in conjunction with Sydney-headquartered B2B media, events and advisory firm Future Place, engaged 100 data centre senior executives, service providers and 'decision-makers'.

56% of respondents believe that hyper scalers are expected to drive the most demand for data centres over the next five years, followed by ICT and defence sectors. 

Australia’s data centre market is currently home to 314 facilities, boasting over 1GW of installed capacity, and operating at a 85–90 per cent utilisation.

Today, only 10% of Australia’s data centre capacity sits in secondary markets, but executives surveyed by A&M, asked to identify the top three regions for growth, see regional NSW, Brisbane, and Perth emerging as hotspots, driven by more land availability, lower costs and proximity to end users for reduced latency.

When A&M sampled the data centre operators in its research, the survey found that just 16 respondents reported renewable energy usage between 10-20 per cent, while 12 indicated usage below 10 per cent.

However, 25 of those operators anticipate that 20-50 per cent of their energy usage will come from renewables by 2028, with many of the respondents ranking cooling solutions as the second-largest area of future capital expenditure, behind AI service offerings.

The most critical issue for data centre operators was identified as power supply limitations, with over 75 per cent agreeing this is the single biggest barrier to future expansion, 

"For Australia to lead in an AI-driven future, a coordinated effort is required from government, developers, operators, and every part of the data centre value chain," the report stated.

"Sustaining investment viability will depend on deploying high-impact capex management strategies, driving smarter builds, efficient procurement, and value-driven design from day one."