Description
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The Tokyo and Osaka data centre markets continue to grow and expand despite the inherent constraints and challenges in power infrastructure and high build costs. Hyperscale demand continues to be the dominant driver of capacity take-up, albeit from a less traditional group of hyperscale companies (more details in the full report), while local Japanese enterprise demand contributes as a steady source of demand. The key questions that the data and commentary within this report are attempting to answer: What are some of the early signs of AI infrastructure deployments in 2024-2025? Where were they located? And what are some of the key drivers that will see more AI inference and training workloads being deployed in Japan over the next five years? More importantly, how will this affect data center rental pricing over the next five years?
The Tokyo market was worth USD $4.3b in 2025 and is projected to grow 12% y/y to USD $4.8b in 2026. Osaka has shifted from a DR-oriented location to a core cloud region for a growing group of hyperscalers due to its central location in Japan and the ability to serve both Central and West Japan. The Osaka market was valued at USD $1b in 2025 and projected to grow 20% y/y to USD $1.2b in 2026. The projected five-year CAGR (2026-2030) for Tokyo and Osaka is 15% and 22% respectively.
Hyperscale cloud continues to be at the centre of all things related to data centres in Japan. The hyperscale-oriented portion of the market, currently 62% in Tokyo, is expected to account for 78% by 2030. Hyperscale colocation is expected to grow 15% y/y in 2026 and is expected to be the primary driver of growth in the Tokyo and Osaka markets. The five-year CAGR for hyperscale colocation in Tokyo is projected to come in at 19%. Osaka is seeing a similar story play out. Hyperscale will constitute 63% of the market this year and account for over 80% by 2030. Osaka’s hyperscale colocation market grew 26% y/y last year and is projected to grow 31% y/y this year with a forward-looking five-year CAGR of 46%.
This report is an excellent resource for any service provider, investor or enterprise end user looking to understand and project the data centre and interconnection market in Tokyo and Osaka or find a service provider.
Read the PDF preview HERE.
