07.02.2023, 11:16

Ho Chi Minh City in list of most affordable land for data centers

First appeared in Cushman & Wakefield’s report on key global data center markets, but Ho Chi Minh City has been evaluated with great potential.

According to Cushman & Wakefield, while most of the largest markets in Asia Pacific (APAC) are under particularly high pressure of rising land prices, only Ho Chi Minh City is among the top 10 most affordable places to develop data center.

The report notes that the land price in HCMC is currently less than 10 USD/sqft (each sqft corresponds to 0.0929 m2). This price is equivalent to Johor, Kuala Lumpur and almost half of Sydney. Compared to the more developed markets in APAC such as Amsterdam and Melbourne, land prices in HCMC are only 1/3 of the price.

In the same group as HCMC, there are 9 other markets including Columbus, Santiago, Johannesburg, Atlanta, Nashville, Phoenix, Austin, Denver and Chicago.

Land prices per sqft of major global data center markets. Photo: C&W.

Along with the rate of more than 70% of the population already using the Internet, this research unit emphasizes that Vietnam has great potential for data center development in the future.

“We are seeing significant interest and investment in Bangkok, HCMC, Hyderabad, Johor and Manila. We expect this to continue, along with interest in other primary and secondary markets in the region,” said Vivek Dahiya, Cushman & Wakefield Data Center Manager at APAC.

In fact, up to now, Ho Chi Minh City has had a number of large data center ecosystem projects. Recently, VNG officially opened VNG Data Center with a scale of 7,800 m2, usable floor area up to 12,400 m2 in Tan Thuan Export Processing Zone (District 7).

Previously, this export processing zone also had a data center of CMC Telecom opened in August 2022 with a total area of more than 13,000 m2. The investor said the facility was 30% full before the launch.

In Ho Chi Minh City Hi-Tech Park (Thu Duc City), Gaw Capital has completed the investment deal in the first phase of a data center project with a scale of more than 6,000 m2, capacity up to 20 MW, completion plan completed in 2024. NTT GDC and Vietnamese company Quang Dung Technology (QD.Tek) also cooperated to develop another data center scheduled to launch in the same year, supporting 6 MW of capacity.

Meanwhile, an Australian data center company, Edge Centers, has expanded into Asia through the deployment of its first data center, EC51, in Ho Chi Minh City, 100% solar powered. The group also has plans for an additional facility in district 1.

Viettel also announced a plan to build a new data center with a total investment of $260 million. Although the specifics of the facility are still unclear, this will be Viettel’s third project in Ho Chi Minh City.

A statistic as of mid-2021 shows that Vietnam has 27 data centers invested and developed by 11 enterprises. However, Ms. Trang Bui, General Director of Cushman & Wakefield Vietnam, said that Vietnam’s data and digital infrastructure is still fragmented and underdeveloped compared to the population size of the market and the demand for Internet services.

“However, this limitation is also an opportunity for investors to participate and build data centers early. According to our records, the majority of foreign developers coming to Vietnam will want through signing cooperation agreements with domestic developers,” she added.

In 2021, research and reporting firm ResearchAndMarkets (Ireland) also listed Vietnam as one of 10 emerging data center markets globally. Market revenue in 2020 is estimated at around 858 million USD and compound annual growth could reach almost 15% until 2026.

@Zing News