Singapore has tied with the United States' Silicon Valley region out of 55 markets in the league of top markets for data centers.

Cushman & Wakefield's 2022 Global Data Center Market Comparison report that was released on Jan. 25 scored Singapore highly on key criteria such as fiber connectivity, market size, and availability of cloud services.

Singapore Ranks High on Top Markets for Data Centers

The real estate consultancy also recognized the Republic's policies that benefit businesses, like low tax rates. Meanwhile, Northern Virginia, the world's largest data center market, took the number one spot for the third year in a row, according to StraitTimes.

The ranking last year placed Singapore 5th out of 48 markets. The Republic is now the top-ranked market for data centers in Asia-Pacific, ahead of Hong Kong, which ranks 6th, and Sydney, which went from 3rd to 8th spot this year.

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Data centers are used by organizations to store, process, and transmit massive amounts of data. Over the past 20 years, Singapore has made great strides in establishing itself as a hub, leveraging its strong fiber broadband connectivity and strategic location.

According to the Speedtest Global Index, Singapore has the highest median fixed broadband speed in the world. It is the landing site for a dense network of undersea cables connecting it to other parts of Europe, Asia, and Africa, as well as the United States and Australia.

A change in the methodology of Cushman & Wakefield for scoring markets in fiber connectivity partly accounts for Singapore's increase in the data rankings.

The reports in the past year had looked only at network density, while the report this year also checked the Speedtest Global Index as a measure of overall broadband speed and performance.

The COVID-19 pandemic and the resulting acceleration of digitalization trends have inflated demand for data centers over the past two years.

Corporations Opening Centers in Singapore

A lot of major multinational corporations have flocked to Singapore to tap that demand. Digital Realty, a US operator, has invested $1 billion to open 3 data centers since 2010, according to Bloomberg. 

Google has 3 Singapore data centers. Since 2011, the tech giant has invested $850 million in data centers in Singapore. In 2021, Equinix, an American digital infrastructure firm, opened its 5th data center in Singapore for $144 million.

Meta Platforms is expected to open a $1 billion data center in Singapore, which will be its first data center in Asia, later this year.

Trade and Industry Minister Gan Kim Yong said that there are more than 70 operational data centers in Singapore in 2021, with a total available IT capacity of 1,000MW.

Meanwhile, Northern Virginia has more than 1,7000MW of operational capacity and is projected to be the first market to cross 2,000MW in the following months.

Singapore's strong performance in the ranking comes despite a moratorium on new data centers that have been in place since 2019.

The release of state land for data centers and the development of new data centers on existing state land were paused for the government to conduct a review of how to grow the industry more sustainably.

Data centers consume massive amounts of electricity from running servers and keeping them cool.

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Written by Sophie Webster