India’s data centre stock is likely to double to 23 million sq ft, translating to a total investment potential of $10 billion over the next three years across the top seven cities, Colliers India-Confederation of Indian Industry (CII) said in its latest report titled “India Data Centers: Entering Quantum Growth Phase”.
The report was unveiled at the Second Edition of the CII Conference on Tech in Real Estate on October 12 at Mumbai.
According to Colliers-CII report, the data pertains to the top seven cities including - Bengaluru, Delhi-NCR, Mumbai, Pune, Hyderabad, Chennai and Kolkata. The stock represents total IT load capacity including occupied as well as unoccupied space, Colliers said in the report.
“Significant expansion of the Indian economy by 2047, will be powered by real estate. A multifold economic expansion will boost demand across all the asset classes - residential, commercial, warehousing, industrial land developments, etc. - will grow at a multiplier rate to accommodate the growing needs of the economy and consumption needs of the individuals," said Dr K Nandakumar, Chairman, CII Maharashtra State Council and Chairman and Managing Director, Chemtrols Industries.
"In recent years, the global real estate sector has witnessed a paradigm shift in its approach to sustainability, with the growing recognition of the Environmental, Social, and Governance (ESG) factors. Environmental, Social, and Governance (ESG) standards have emerged as crucial factors for analysing the long-term viability and ethical practices of businesses in a variety of industries, including real estate," he added.
As of August 2023, the data centre capacity across the top seven cities stands at 819 MW, spread across 11.0 million sq ft. Led by exponential increase in data consumption, improving regulatory framework and robust investments in the sector, the data centre capacity is likely to double up faster in the next phase of growth, crossing 1,800MW by 2026, added the report.
"Data centre as an asset class is proving to be a play with high yield and lower risk once stabilised, with sticky customers which enables patient institutional capital to write larger cheques.” said Ramaiy Kapoor, Managing director, Data Center, Colliers, India
Mumbai mature data centre hub; Tier II cities witnessing steady growth
"Mumbai continues to remain a relatively matured data centre hub, hosting half of the data centre capacity of the country. Chennai, Bengaluru and Delhi-NCR are already relatively established markets, while Kolkata remains an emerging hub catering to the zonal data requirements of the region," said the report.
Also read: Indian cities to add 693 MW of data centre capacity by 2026: Report
It added, "In the next three years, Mumbai is expected to account for about half of the new additions, owing to the presence of submarine cable connectivity, landing stations and internet exchanges. Along with Mumbai, Chennai and Hyderabad are also likely to witness increased growth owing to strong support infrastructure and encouraging regulatory framework."
While Tier I cities are preferred locations for data centre expansion, Tier-II cities are also witnessing steady growth. Currently, Tier-II cities hold only four percent of the total data centre capacity in India. However, key data centre operators are eyeing multiple cities such as Ahmedabad, Jaipur, Kochi, Nashik, Vijayawada and Bhubaneshwar as potential locations for setting up Edge data centres and as disaster recovery sites, said the report.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
