[+] Next-Gen Tech Reshaping Data Centre Landscape

Demand for data—and data centres—is insatiable. The International Data Corporation forecasts that by 2025 the global datasphere will grow to 163 zettabytes—that’s a trillion gigabytes. This, compounded by the Federal government’s focus on data sovereignty and the growth of AI and autonomous technologies in recent years, means demand for secure data centres in prime locations has never been higher and will continue to grow. But whether data centres can provide an opportunity for developers is another matter. The world’s biggest operators are household-name telcos and cloud vendors (‘hyperscalers’) such as Amazon Web Services (AWS), Microsoft Azure, Google Cloud and Meta Platforms, who rub shoulders with co-location companies such as Equinix, NextDC and CDC Data Centres. As these companies expand and contract with consumer demand for data, data centres need to be bigger and more agile. They have also begun to encroach on areas previously the province of inner-city developers, moving into premium space in highly populated areas. ▲ NextDC is one of a host of co-location data centre operators with data centres from Sydney and the Sunshine Coast to Perth, Darwin and Port Hedland. Cushman &amp; Wakefield Australian Data Centre Advisory Team leader Alex Moffatt says Australia’s major capital cities are hotspots for data centre investment in the APAC region, driven by large urban populations and high per capital data consumption. “Sydney is the clear leader in Australia by operational capacity. Activity continues to increase in both Melbourne and Brisbane, and interest in the Perth market has increased significantly in the past 12 months,” Moffat says. There is also “significant interest” from Australian and offshore funds to invest in excess of $1 billion from dedicated data centre funds. According to recent reports, 77 per cent of investment in APAC data centres comes from overseas, predominantly the US. Cushman &amp; Wakefield managing director and head of the Asia Pacific Data Centre Advisory Team Vivek Dahiya says that although owner-built and operated data centres are still the preferred model for some hyperscalers, limited availability of suitable land with sufficient electricity is prompting an evaluation of other options. “Long term built-to-suit (BtS) lease transactions and dedicated property platforms are some of the new deal structures being concluded,” he says. ▲ There are more than 8000 data centres in the world, a third of which are in the US. Architecture and engineering firm HDR plans and designs data centres for the likes of NextDC, which operates more than a dozen data centres in Australia, Japan, Malaysia and New Zealand. HDR national director for education and science Graeme Spencer says the data centre market is changing at an accelerated pace. “There is a growing number of new entrants in the industry, including smaller and environmentally-conscious players,” Spencer says. “The trend is shifting towards the CBD, where large-scale megasites or dense multi-story data centers are being constructed due to the increasing cost of land. “Consolidating major infrastructure into a single location is more feasible than replicating smaller sites repeatedly. “These types of structures will become more common and integrated into our urban landscape, so it is important to consider the design response carefully.” How to build a data centre Building a specialised asset like a data centre requires a distinct skillset. HDR recently designed two NextDC co-location data centres including a 100,000sq m data centre at West Footscray,and M2 Melbourne, a 16,000sq m data centre at Tullamarine. “It’s the most unique typology I’ve ever been involved in. The scale is extraordinary,” Spencer says. “We also use data-driven computational design and predictive analytics so we can rapidly test different orientations, different stacking. “You’re designing a building that can be rapidly erected using modular systems and some of the facades can be 200m long. “You also need to carefully consider acoustics, from mechanical and generator noise to articulated vehicles regularly moving through the sites, and if you are located in those residential areas how do you break down the mass and soften the edge?” Data centres have moved on considerably from the preconceived notions of concrete shells filled with blinking lights. “Nowadays, the industry is shifting towards more sophisticated and visually appealing designs,” Spencer says. “For instance, imagine a data centre with a commercial frontage that celebrates the business, followed by a secure and complex machine behind it.” ▲ Data centres have moved away from industrial aesthetics to focus on office-inspired design. One of the critical things for data centres is, of course, access to power and wider infrastructures. Nicholas Blay is senior electrical project technical lead at engineering firm Stantec, which has upgraded data centres in Australia for Fujitsu and built hyperscale data centres across the world. “Energy usage is split into two parts—energy usage for operating servers themselves and then additional usage for mechanical cooling and ancillary services,” Blay says. “Being as energy efficient as possible is a key issue and a lot of different technologies are deployed depending on where the data centre is physically located.” Energy usage and the surrounding building environment are all key consideration. But given the number of data breaches at Australian companies in recent years and the focus on data sovereignty—which led the Government’s Digital Transformation Agency to set up a data hosting certification framework—security concerns have also accelerated. “Physical security is easier to manage than virtual,” says Blay. “It’s a threat you can see coming rather than an IT threat, so all facilities do have a high level of security design, depending on who the end client moving into the facility is, will determine the level they require.” Crash barriers, CCTV, access control systems, and full body scans make data centres more difficult to traverse than an airport, and thus much more difficult to design and build than a conventional industrial space. “Data centres are no different to a highway or a hospital, it’s just as critical as our other infrastructure, and so security is number one, “ says HDR’s Graeme Spencer. Sustainability in focus In light of the rapid growth of data centres and their subsequent energy consumption and carbon omissions, data centres have been treated with kid gloves by many governments. The Department for Climate Change, Energy, Environment and Water says that the average Australian data centre is now more than 20 years old and many are inefficiently designed, which has prompted designers of the next generation. ▲ The data processing and storage market globally is expected to grow in value to $US90 billion by 2025. “Across the globe there is a real drive by the data centres operators to lower their footprint, and what they’re moving towards is some amazing technology which is being developed including submerged data racks,” says Blay. Microsoft, for instance, has invested in a project which submerged data racks in the ocean concluding that it was “feasible, as well as logistically, environmentally and economically practical”. Location, location, location As demand will only increase for data, and new players will enter the market, the question is where will these centres be located? New builds are still the preferred option for data centres due to the stringent requirements of data centres, from ceiling height to security and energy infrastructure accessibility. This has often led developers to look to outer city areas—the home of logistics and industrial uses—for data centres. But this could be changing, says Stantec’s Nicholas Blay. “The Sydney and Melbourne markets are well laid out, so it’s the smaller cities that will experience growth. “Perth has landing pads for some of the sub-sea cables, so there will be growth opportunities there as it’s the first and last point of call to Asia and Europe, and also within Brisbane as well.” ▲ The US owns 33 per cent of the world’s data centres followed by the UK Germany, China, Canada and the Netherlands, which collectively own 23.1 per cent. Data centres have tended to be in the outer suburbs where land is cheaper, power is consistently available and there is less of a consideration of residential neighbours. “But with the push towards artificial intelligence, the Internet of Things and with the load latency connections, edge data centres closer to the city centres are now being discussed. “Things like autonomous vehicles need data centres to be close to the point of use, so the edge will really take off with smaller data centres built within the cities themselves. There’s a handful now, but the edge may come into play a little more.” In Australia generally, there remains strong demand and AWS recently revealed plans to invest $13.2 billion in data centres, particularly in Victoria and NSW. “The large hyperscale cloud operators are pioneers of data centre activity. Where they go, other data centre operators follow,” says Cushman &amp; Wakefield’s Dahiya. &ldquo;In comparison to Singapore, Australia&rsquo;s population is over four times the sovereign state's, however, the live MW in Singapore at 893MW compared to Australia&rsquo;s at 1,134MW is only about 1.3 times higher&rdquo; he says. &ldquo;This is a good indication that the future of data centres in Australia holds much promise and is forecast to increase.&rdquo; --> You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

[+] Next-Gen Tech Reshaping Data Centre Landscape

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