SC Zeus Data Centers Enters Japan Market with 50MW Osaka Project

SC Zeus Data Centers has acquired an Osaka site to develop a 50MW data centre project, marking its entry into the Japanese market.

According to the Japanese-language press release on Tuesday, the 13,223 square metre (142,331 square feet) site in Osaka’s central business district will allow the company to start the first 25MW phase of the project, which the company expects to begin operating by 2027.

“We are thrilled to announce the successful acquisition of our site in Osaka. This is another significant step in our journey, following the start of a hyperscale facility development in South Korea. It demonstrates our strong commitment to providing robust data centre solutions in the APAC region,” said Joe Gooi, chief executive officer of SC Zeus.

The move takes place after the developer entered Japan in September by establishing its SC Zeus Data Centers KK subsidiary in Tokyo.

Regional Expansion Continues

The Osaka project is the first in a series of Japanese projects planned by the Singapore-based developer. SC Zeus said that the company will develop more data centres expected in the Tokyo metropolitan area and the Kansai region by 2030 with a cumulative target of 200MW in the island nation.

The statement on Tuesday confirmed that the firm has begun development of a $500 million data centre in South Korea first announced in February 2022. Now scheduled to begin operations in 2026, the Seoul project will support 50MW of IT capacity, an increase from its initial target of 45MW.

Gooi said in an interview in October last year that SC Zeus aims to develop 300MW of greenfield data centre projects across Asia Pacific over the next three to five years. The company expects to build another 100MW to 150MW of brownfield projects on its way to establishing $6 billion in assets under management (AUM), he added.

“Our immediate focus is on Japan and South Korea. Beyond that, we also see potential in Southeast Asia, Australia and greater China. We expect approximately 60 percent of the capital allocation to go to Japan and South Korea, due to the depth and liquidity of those markets,” Gooi said in the October interview.

SC Zeus Data centres was formed in 2021 as a joint venture between SC Capital Partners and Abner Investments, according to a statement from Allen & Gledhill which advised on formation of the new entity.

Developers Pile into Japan

SC Zeus’ Osaka project follows a trend of global and regional companies investing in Japanese data centres, including Singapore’s Mapletree Industrial Trust acquiring a completed Osaka data centre in May for JPY 52 billion ($370 million). The 10MW facility was the Temasek-linked REIT’s first investment in Japan.

Last August, industrial developer GLP began building  a 31MW campus in western Tokyo, marking the Singapore-based firm’s first data centre in Japan. Then in December 2022, ESR Group partnered with US-based operator Stack Infrastructure to develop a 72MW data centre in Keihanna, an eastern suburb of Osaka.

Diarmid Massey, chief executive officer of ESR’s data centre division, said on MTD TV in September that the increased demand for colocation facilities, driven by ChatGPT, has led to ESR’s expansion of data centres in Japan and Korea.

“We believe that the AI boom is here to stay as well as the ongoing evolution to the cloud and digital transformation across industries in Asia-Pacific – not seeing the demand slowing down,” Massey said. “We’ve seen an unprecedented take up in the US in the last quarter and we’re starting to see that coming into Asia Pacific, specifically in North Asia.”