Research

Indonesia's potential for data center real estate market

The pandemic has shown how the internet plays a crucial role and has accelerated the digital economy's rise, which drives data centers' demand

April 30, 2021

Indonesian Data Center Market has garnered a lot of attention in the past couple of years. In fact, we have seen major cloud players came in and opened new cloud regions in the country; and more is coming. Land acquisition for new data centers is also at a record high, all to serve the ever-increasing cloud demand.

Data center is one of the few asset classes that thrives during the pandemic. More than ever, we rely on technology and the digital world to carry-out our day-to-day activities. In 2020 alone, there was a 50% increase in the number of digital services user.

We have not yet seen the full impact of the pandemic, but we expect the flight to digital to be permanent; and its effect on the digital economy to be massive. It is currently estimated that by 2025, the Indonesian digital economy will be worth over 120 billion dollars, nearly triple of what it’s worth right now. With such a large and exponentially growing demand as the backbone, we expect strong growth in Data Center to continue for the foreseeable future.

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