Japan ViewPoint - Data Center Identifying Future Development Hubs December 2021

•Since the advent of the COVID-19 pandemic, demand for data centers in Japan has surged. As it fulfills all of the requisite criteria for a data center location, Inzai City in Chiba Prefecture has seen a large number of new data center developments.

•However, the concentration of new data centers in a single location poses serious risks from a business continuity perspective. For this reason, plans are afoot among data center operators, to disperse the locations of future developments.

•There are three major requisite criteria for data center locations: the ability to procure vast amounts of electrical power, the ability to construct high-quality communication networks, and a low risk of natural disasters.

•Traditionally, data centers have tended to be concentrated in the central areas of major metropolises. Recently, however, new developments have begun to be introduced in suburban areas and regional cities.

•CBRE projects the regional dispersal of data centers to continue, with Sapporo and Fukuoka, in particular, providing attractive options which have in place many of the necessary criteria.