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Capitaland Investment commits over US$700 million to build its first data centre in Japan

Singaporeโ€™s Capitaland Investment (CLI) is expanding its digital infrastructure footprint with a $700 million investment to develop its first data centre in Japan, as demand for AI-driven computing power continues to soar.

Reuters reports The Temasek-backed real estate asset manager has secured a land parcel in Osaka, along with 50 megawatts (MW) of power capacity, setting the stage for a significant entry into one of Asiaโ€™s fastest-growing data centre markets.

This move is part of CLIโ€™s broader strategy to capitalise on the surging need for high-performance computing facilities amid rapid digital transformation across industries.

โ€œWith the rapid adoption of digitalisation and AI globally, and especially in Asia, data centre demand is expected to enjoy double-digit growth, far outstripping new supply,โ€ said Michelle Lee, CLIโ€™s managing director of private funds (data centre).

The investment follows CLIโ€™s steady push into data centre development and ownership, with the company adding 23 data centres to its portfolio since 2021.

The firm has been strategically expanding into key markets to support cloud computing, AI applications, and enterprise digital infrastructureโ€”sectors that are experiencing unprecedented growth due to increased reliance on machine learning, automation, and big data analytics.

Osaka, Japanโ€™s second-largest metropolitan area, is emerging as a major hub for data centre investment, thanks to strong connectivity, reliable power infrastructure, and proximity to major tech and financial industries.

With the countryโ€™s digital economy accelerating, major cloud providers and tech firms are actively expanding their presence, making Japan an attractive market for real estate and infrastructure firms like CLI.

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Catherine Nikas-Boulos

Catherine Nikas-Boulos is the Digital Editor at Elite Agent and has spent the last 20 years covering (and coveting) real estate around the country.