Chongqing—Cushman & Wakefield's latest report explores the evolution of data centers from basic server rooms to complex hubs, fueling the growth of the Internet and the IT revolution. It also provides insights on global investment trends.

A data center is a facility that stores, manages, and processes data using servers, storage, and networking equipment. It supports cloud computing, data storage, and disaster recovery, ensuring reliable and secure access to data for various sectors, such as e-commerce, finance, and healthcare.

The report highlighted key global trends in the data center sector, noting that the rising demand for intelligent computing has driven ongoing expansion. Data centers are increasingly designed to be high-density and energy-efficient, with a shift from high energy consumption to more sustainable, eco-friendly development.

China has launched an implementation plan to further the "East Data, West Computing" project. Under this project, western data centers are responsible for backend processing, offline analysis, storage backups, and other services with lower network demands, while eastern hubs handle services requiring high network capacity, such as industrial internet, financial services, real-time communications, and AI processing.

The initiative's most direct application is the transfer of data processing, cloud computing services, and AI workloads from data-hungry eastern regions such as Beijing, Shanghai, and Guangzhou to western provinces like Sichuan, Gansu, and Qinghai. These western regions have abundant renewable energy sources, particularly hydropower, which makes them ideal locations for energy-intensive operations like data centers.

China's "East Data, West Computing" project. (Graphics/Chen Zhan)

Currently, the Beijng-Tianjin-Hebei region, the Yangtze River Delta, and the Guangdong-Hong Kong-Macao Greater Bay Area have emerged as key data center hubs due to their strong economies, concentration of internet companies, and large market demand. These regions generally boast higher occupancy rates and service fees compared to others.

However, compared to the rapid expansion of data centers abroad, the report noted that some Chinese data centers face challenges with listing rates and occupancy levels. 

Despite the robust demand in key regions, there remains a gap in supply, particularly in second-tier cities and less developed areas, where market conditions are not yet as mature. As a result, these regions are struggling to attract the same level of investment and are experiencing slower growth compared to their international counterparts.

Analysis of domestic and global data industries. (Graphics/Chen Zhan)

In contrast, the global data center market is seeing a surge in demand, especially in regions like North America and Europe, driven by factors such as increasing cloud adoption, the growth of AI and big data, and the ongoing digital transformation of businesses. 

The report pointed out that while China has made significant strides in infrastructure development, the country's data center market still faces challenges related to regulatory constraints, energy consumption concerns, and the need for more green technology adoption.

Cushman & Wakefield predicts continued growth in the global data center market, with sustainability becoming an increasingly important focus. 

As businesses and governments prioritize greener solutions, data centers are expected to invest more in renewable energy and energy-efficient technologies to meet environmental targets. This shift will reshape the data center landscape, presenting opportunities and challenges for investors and operators.