Tokyo takes colocation crown in global study

26 October 2021 | Melanie Mingas

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Tokyo has been named as the world's largest retail colocation market with 13.8 million square feet of gross retail capacity reported in 2021.

Demonstrating the strength in Tokyo, the second and third largest markets – Hong Kong and Washington, Virginia – each have a 50% smaller data centre footprint than the Japanese capital.

The figures –- crunched and published by TeleGeography’s Data Center Research Service – also named Mumbai, Seoul, Montreal, Madrid, and Johannesburg a "noteworthy markets", with at least one million square feet of retail colocation space. Each has seen rapid growth of between 18% and 35% CAGR for gross capacity in the last five years.

Commenting on the wider findings Jon Hjembo, senior manager at TeleGeography said: “Long-term colocation growth across markets tends to be modest in both large and smaller markets. Between 2017 and 2021, the median CAGR among a sampling of 109 markets was just 6%.

“Major hubs outpacing the median growth rate include Amsterdam, Frankfurt, and Washington, each with at least 10% compound annual growth in retail capacity.”

In recent months, a number of major players have confirmed plans for the Japanese market including Colt, Princeton Digital Group, Lendlease,  Zella DC and Digital Edge.

TeleGeography said it knows of "at least 200 data centre sites"  in the pipeline currently. Construction is spread across global regions, however, Asia and Europe far outpace other regions, including North America, with the largest percentages of new deployments.

“We’ve also observed a recent inflection point in the data centre and broader interconnection market,” added Hjembo.

“While traditional hub markets have seen continual growth, numerous secondary markets and metropolitan nodes on the frontier of network development have seen tremendous new investment by both local and international operators. This has involved a mix of network, data centre, cloud, and internet exchange operators, working together to build new and more widely distributed hubs,” Hjembo added.