Cloud adoption continues to support underlying demand

• Global hyperscalers continued to demonstrate appetite for self-build sites in strategic metropolitan locations.
• New data storage strategies and cloud outsourcing by universities, government bodies and major healthcare and financial service companies in particular, continue to bolster hyperscale and co-location requirements.

Sydney’s supply pipeline remains robust

• Sydney’s co-location supply pipeline remains large, however just 12% of the pipeline (by MW) is currently under construction, with the majority of the pipeline accounted for by land banking activity.
• Canberra Data Centres (CDC) opened EC4 (54MW) at their Eastern Creek campus in 4Q22. CDC has announced intentions to further increase site capacity by over 100MW.

Sovereignty and security remain top priorities

• As of July 2022, Australian government agencies must use accredited data centre providers on the new panel (administered by the Australian Digital Transformation Agency) to host sensitive data systems. Major corporates are expected to follow suit.

Outlook: Hyperscaler site acquisitions to become more selective

• Although Sydney remains Australia’s Tier I data centre market, site acquisition activity is expected to moderate as groups work through current pipelines and target key opportunities in other Australian cities.