# Malaysia’s Data center colocation market grows 18.6% annually through 2031

Digest AI · Hardware & Compute · published 2026-10-05T01:33:00Z

Canonical: https://digestai.news/story/malaysias-data-center-colocation-market-grows-18-6-annually-through-20

## Summary

Malaysia’s data center colocation market is projected to expand at a compound annual growth rate of 18.6% from 2025 to 2031, driven by AI workloads, hyperscale investments, and government incentives. By 2031, the utilized data center area is expected to reach **24.89 million square feet**, with rack capacity totaling **609,300 units**, according to a report by ResearchAndMarkets.com published on October 5, 2026.

Cyberjaya remains the country’s primary data center hub due to its infrastructure and government support, while Johor is gaining traction as a new major location. AI and GPU-intensive workloads are reshaping demand, requiring higher-density racks, liquid cooling, and renewable energy. In July 2025, **YTL Corporation** announced a **$2.36 billion** investment in AI infrastructure with NVIDIA, and in June 2025, **SK Innovation** partnered with **Bridge Data Centres** to deploy liquid cooling solutions. These trends reflect Malaysia’s push to support AI and hyperscale computing needs.

## Key points

- Malaysia’s data center colocation market grows at **18.6% CAGR** through 2031, reaching **24.89M sq. ft** of utilized space by 2031
- AI and GPU workloads drive demand for **liquid cooling, high-density racks, and renewable energy** in new facilities
- **YTL Corporation** invested **$2.36B** in AI infrastructure with NVIDIA in July 2025, while Johor expands as a key hub

## Why it matters

The rapid growth in Malaysia’s data center market reflects AI’s rising compute demands, with hyperscale players and government incentives shaping infrastructure investments. Liquid cooling and high-density racks are becoming critical for AI workloads, influencing global data center trends.

## Sources

1. [Malaysia Data Center Colocation Market - Supply and Demand Analysis and Forecast 2026-2031 | AI and Hyperscale Investment Fuel 18.6% CAGR and Johor Expansion](https://finance.yahoo.com/technology/ai/articles/malaysia-data-center-colocation-market-083400790.html) (finance.yahoo.com, 2026-10-05)

## Cite

Digest AI, "Malaysia’s Data center colocation market grows 18.6% annually through 2031", 5 October 2026, https://digestai.news/story/malaysias-data-center-colocation-market-grows-18-6-annually-through-20

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