A growing demand data centres across the globe could soon impact the Thailand market, according to CBRE.

New research from the firm indicates the use of technology and various digital platforms in the fight against COVID-19 coupled with an increase in online penetration has resulted in "vigorous" demand for data centre facilities globally.

CBRE Thailand Head of Transaction and Advisory Services for Industrial & Logistics, Adam Bell, said while China was home to the largest data centre market in the Asia Pacific region, other key players such as Thailand were poised for further growth.

“Although neighbouring countries like Singapore and Hong Kong are credible for their services and business settings over the years, they are facing land constraints for such infrastructures," he said.

At a glance:

• CBRE believes Thailand could welcome more data centre facilities in the future as part of a global trend.
• According to CBRE, the use of technology and various digital platforms in the fight against COVID-19 coupled with an increase in online penetration has resulted in greater demand for data centre facilities globally.
• Industry heavyweights such as Frasers Property Thailand are speculating the ‘new normal’ will continue to drive the growth in demand for data centres. 

"Singapore’s current regulation is restricting new data centre developments, strictly restraining the issuance of more data centre licenses.”

Mr Bell said the numerous Board of Investment (BOI) tax and non-tax privileges available to incentivise investors and Thailand’s centralised location made it an "opportune" time for the country to develop data centre services.

"Thailand's promoted Eastern Economic Corridor (EEC) is situated just 30 kilometres away from undersea cables yet over 100 metres above the sea level, minimising flooding risks," he said.

"Moreover, the implementation of 5G technology in the near future will pave the way for the Internet of Things (IoT) infrastructure in Thailand.

"There will be a change in the dynamics of digital technology utilisation due to its much higher bandwidth, lower latency, and higher connection density.

"It is definite that the rollout of 5G would require adaptations in both the deployment and design of new data centres to support 5G frequencies."

According to CBRE Research, big players such as Frasers Property Thailand are speculating the ‘new normal’ will continue to drive the growth in demand for data centres.

Its joint venture with ST Telemedia Global Data Centres will offer 30,000 square metres in the first phase for clients such as cloud operators, e-commerce businesses, and financial institutions.

Mr Bell said South Korea’s KT Corporation also planned to infiltrate the Thai market by H2 2021 and provide a high standard of services to global cloud companies.

“To compete in this fast-growing market, Thailand must secure its place by improving the expertise needed to operate data centres and to ensure high cyber security standards thus, increasing our credibility," he said.

"As data centres require high and stable power and water supply, infrastructure providers must ensure these utilities are guaranteed.

"New policies should also be implemented to promote business competition domestically.  

"As yet, data centres are a relatively new and uncharted asset class, meaning their full market cycle is yet to be seen."

Similar to this:

Luxury detached houses and condominiums near educational institutions leading Thailand property recovery - CBRE

Knight Frank research shows extent of 'serious blow' experienced by Bangkok luxury hotel market

Continued demand and the new normal in the Thai residential market - CBRE