Japan ViewPoint - Big Data, Bigger Yields: Japan’s Data Centers Represent Opportunity for Savvy Investors November 2017
Investors are displaying a growing interest in data centres as a new asset class for real estate investment. With yields falling for almost all real estate asset types in Japan, relatively high yields are one of it’s attractions.
The number of new data centres in Japan has been stagnating and there is a growing sense that there is a shortage of data centres. In addition, recent surveys indicate that real demand for data centres will continue to expand.
There are three key criteria when choosing the location for a data centre: (1) power supply availability, (2) network quality, and (3) minimising natural disaster risk. More specifically, a site well suited to data centre would: have the availability of super-high voltage of at least 60,000V; be within a 50km radius of city central; and be in a region with low natural disaster risk. In Japan, the considerable time taken to secure power supply is a bottleneck to establishing sites for data centre use.