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AI boom drives record loans for data centres in Southeast Asia

Southeast Asia has become a data-centre hotspot as tech multinationals diversify beyond China amid geopolitical tensions

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A view of Kuala Lumpur’s skyline in Malaysia. Photo: Reuters
Artificial intelligence (AI) advances are fuelling a funding frenzy for data centres in Asia, spawning a series of record-breaking loans and filling the pipeline with even more potential deals.
In the span of a week, two major Asian data-centre operators secured their biggest-ever loans, partly earmarked for the expansion of their operations in Malaysia, which is becoming a hub for these facilities.

The deals underscore the industry’s appeal in attracting a range of investors – from banks to real estate players – as the AI boom drives demand.

They also show how much of a data-centre hotspot Asia has become, with demand set to expand by about 32 per cent a year through 2028, according to data by real state services firm Cushman and Wakefield, outpacing the US’ expected growth of 18 per cent, though US tariff policy could be a wild card for the industry.

A surge in demand of AI services and the US-China tech war are driving a data-centre boom in Southeast Asia. Photo: Shutterstock
A surge in demand of AI services and the US-China tech war are driving a data-centre boom in Southeast Asia. Photo: Shutterstock

“The surge in demand for data-centre capacity has piqued the interest of an ever-growing diverse pool of capital investors and providers across Asia-Pacific,” said Yemi Tepe, a partner at law firm Morrison Foerster, who has worked on tech-related financial transactions.

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