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Pandemic fuels record growth of hyperscale data centers

There are now 659 data centers operated by large providers

23 Eylül 2021

As the pandemic completely disrupted the way people work, data centers played a pivotal role running our increasingly tech-driven world. The result? Increasing data center demand and investment, especially when it comes to the biggest data centers. 

New data from Synergy Research Group shows that the total number of data centers operated by hyperscale providers globally increased to 659 at the end of the second quarter, an increase of 59 from the end of 2020. It has nearly doubled since 2016.

“The pandemic had a significant impact on data center sector demand and investment,” says David Barnett, Director, Americas Research.

Location, location, location

The U.S. and China continue to account for more than half of hyperscale sites. The next most popular locations are Japan, Germany, the U.K., Australia, Canada, Ireland and India, according to Synergy. 

Technology companies have been notably active in Asia Pacific, according to JLL research. For example, several U.S.-based tech giants were recently granted conditional approval to build and manage hyperscale data centers and cloud services in Malaysia. “Reentry there has driven recent industry growth, primarily in China,” Barnett says. 

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In the U.S., Northern Virginia continues to lead in construction activity, while significant gains were made in the notably tight markets of Northern California and the Northwest, which both have submarkets with vacancy in the single digits.

In Canada, development significantly increased in Toronto in the first half of the year with 52 megawatts under construction. However, scarce land availability may hinder expansions throughout 2021.

“The overall construction pipeline in North America is forecast to grow throughout the year to meet growing demand from cloud, technology and social media companies,” Barnett says.