APAC Data Center Market to Reach USD 255.49 Billion by 2031, While Colocation Investment Set to Add USD 64.08 Billion — Arizton

2026-06-17 · Source: The AI Journal · Field: Technology & Digital — Cloud Computing & IT Infrastructure, Emerging Technologies & Innovation · Depth: Fundamental Awareness, short

Summary

The APAC data center market is projected to reach USD 255.49 billion in investment value by 2031, growing from USD 126.64 billion in 2025 at a CAGR of 12.41% between 2026 and 2031, according to Arizton Advisory & Intelligence. This expansion is driven by accelerated digital transformation, increased cloud adoption, and the scaling of infrastructure for AI workloads. China led regional investments in 2025 with 47.92%, while Japan accounted for 10.08%. India and Australia are also strengthening their positions. Land availability constraints in major hubs like Singapore and Tokyo are shifting focus to secondary markets such as Malaysia and Thailand. The colocation market is also set for significant growth, reaching USD 64.08 billion by 2031 with a 15.36% CAGR. Higher-density AI workloads are boosting demand for liquid cooling, which represented 55.2% of cooling infrastructure investments in 2025 and is expected to hit 59.0% by 2031. Government policies are reinforcing this expansion, creating a favorable investment environment.

Key takeaway

For investors and infrastructure planners evaluating APAC expansion, you should prioritize markets like India, Australia, Malaysia, and Thailand, given land constraints in traditional hubs and strong government support. Your strategy must account for the increasing demand for high-density AI infrastructure, particularly the rising adoption of liquid cooling, which will impact facility design and operational costs. Consider partnering with providers scaling capacity in emerging digital hubs to capitalize on the projected 12.41% CAGR through 2031.

Key insights

APAC data center and colocation markets are set for substantial growth, driven by AI, cloud, and government support.

Principles

• AI workloads demand higher density infrastructure.
• Policy support accelerates digital economy growth.
• Land constraints shift investment to secondary markets.

In practice

• Evaluate secondary APAC markets for data center sites.
• Invest in liquid cooling for high-density AI racks.
• Monitor government digital infrastructure programs.

Topics

• APAC Data Centers
• Colocation Market
• AI Infrastructure
• Liquid Cooling
• Digital Transformation
• Government Policy

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Editorial summary, takeaway, and curation by AIssential. Original article published by The AI Journal.