Data center infrastructure continues to flourish in China with Keppel’s sixth project

• Keppel Data Center Fund II in strategic partnership with Heying to develop a new greenfield data center in Greater Beijing.
• Huailai Data Center development is being done in stages and is anticipated to be finished by the end of Q1 2023.

As China’s digital businesses continue to grow and as traditional sectors continue to digitize, there will be greater demand for data center infrastructure and high computing capacity.

Digitization is one of the government’s key development targets for the next ten years and a central goal of the 14th Five Year Plan (FYP). According to the plan, China has already expressed its efforts in accelerating the development of a coordinated big data center infrastructure at the national level.

In support of this plan, Heying, a wholly-owned subsidiary of Tianjin Zhengxin Group Co., Ltd, and Keppel Data Centre Fund II LP (KDCF II) have engaged in a strategic partnership to jointly create a greenfield data center in Greater Beijing, China. This latest development marks Keppel’s sixth project since entering the data center market in mainland China in 2020.

It’s worth noting that the China Data Center Market was valued at USD 13.01 billion in 2020 and is anticipated to grow at a CAGR of 19.2% from 2021 to 2026 to reach USD 36.18 billion.

In addition, China is putting a lot of effort into establishing itself as a leader among other countries when it comes to building data centers. Larger enterprises are looking to scale up their data centers to ensure the stability and dependability of data services as the use of 5G, wearable technology, the internet of things, and artificial intelligence fuel an increase in demand for computing power.

Getting to know Keppel’s data center infrastructure

The private fund management division of Keppel Capital, Alpha Investment Partners Limited (Alpha), will manage KDCF II, which will acquire a majority stake in Huailai Data Center and co-develop the property with Heying. The project’s estimated RMB 1.4 billion (SG$292.0 million) in development costs. Additionally, Keppel Data Centers and Heying will work together to apply international best practices for operating data centers at Huailai Data Center.

Huailai Data Center development is done in stages. It is anticipated to have a gross floor area (GFA) of 678,807 sq. ft. when it is finished by the end of Q1 2023. This space can accommodate more than 5,700 high-density racks and will meet China Data Center Class A GB-standard requirements. A significant Chinese cloud service provider has shown substantial interest in Huailai Data Center.

Huailai Data Center will be equipped with indirect evaporative cooling (IDEC) systems, which use evaporating water to cool airstreams and manage humidity in accordance with Keppel’s Vision 2030, which places sustainability at the center of its strategy. This approach uses 50% less energy than conventional chilled water systems.

According to Alvin Mah, CEO of Alpha, they are happy to work with Heying to penetrate one of China’s biggest hubs for data centers. “Demand for data centers in China has been resilient, attracting strong investor interest. Keppel Data Centre Fund II LP is well-positioned to seize investment opportunities in this growing sector as we are able to collaborate with the wider Keppel Group to provide robust and reliable data center solutions,” he continued.

Wong Wai Meng, CEO of Keppel Data Centers added that the company’s approach to collaborating with Keppel Capital and strong, experienced partners allows them to quickly scale up in the development and operation of high-quality data centers in their key growth markets.

He also said, “This has helped place Keppel Data Centers in pole position to meet the requirements of cloud service providers, hyperscalers, and technology firms in one of the world’s fastest-growing markets, building on our strong data center development and operational track record.”

Separately, Keppel is not the only company accelerating the development of data centers in China. In fact, there are numerous players in the China data center market, including well-known internet juggernauts like Alibaba Group Holding Ltd, China Telecommunications Corporation, and China Mobile International.

In light of the major players’ ability to assist China’s aim to expand its digital economy, it is safe to say that the country has a reliable data center ecosystem.

---

---

---

---