‘Fear factor’ troubles data centre operators over cross-border information sharing, threatening Hong Kong’s hub ambitions
- A proposed agreement on making cross-border data transfers easier within the Greater Bay Area has raised concerns among international data centre operators
- Space occupied by data centres in Hong Kong is expected to increase by 34 per cent to about 14 million sq ft by 2025, according to Cushman & Wakefield
Hong Kong has the potential to become a global data centre hub, but uncertainties such as geopolitical concerns and fears over cross-border data transfer are holding back growth, according to industry observers.
Western companies are increasingly hesitating to set up or expand their data centre footprint in Hong Kong because of heightened geopolitical concerns, CBRE said in a recent report.
“There are some geopolitical concerns on whether [Hong Kong] can balance [itself] as an international market to house different sides of data,” said Samuel Lai, an executive director at CBRE Hong Kong, noting that these concerns have slowed down a major take-up in data centres from companies.
While this is not seen as a growing trend, recent deals indicate there is some balance between Chinese and Western companies in the market, he added.
GDS, a Shanghai-based data centre operator, last month leased a 300,000 sq ft cold storage building in Kwai Chung to convert it into a data centre. Another deal last month saw Australian data centre operator AirTrunk lease the 150,000 sq ft San Miguel Industrial Building in Sha Tin.