‘UAE Takes the Lead in Middle East Data Center Revolution’

As the governments’ push towards digital transformation fuels demand for data centers in the Middle East, the UAE has firmly established itself as a leader in driving the data center evolution with around 28 active colocation facilities, revealed JLL in a whitepaper at Cityscape Global. Several data centers and cloud providers have either established a presence or are seeking to expand their footprint in the country.

The whitepaper, titled ‘Unleashing the Potential: The Future of Data Centers in the Middle East and Africa’, recognizes Dubai and Abu Dhabi as the country’s prime data center markets and two of the smartest cities, not only in the region but among the top 20 globally, according to the latest Institute for Management Development’s Smart City Index. This reinforces the UAE’s continued efforts to transform into a strong digital economy and consolidate its position in the region’s growing data center landscape. Key players like Khazna and Equinix are further accelerating this momentum, with the former aiming to achieve a total planned capacity of 300 megawatts by adding 12 new facilities to its portfolio in just two years.

Besides boasting an outstanding internet penetration rate of over 98%, the UAE has also gained recognition as the regional Artificial Intelligence (AI) innovation hub, driven by initiatives such as Smart Dubai and Dubai Artificial Intelligence in Health. Moreover, on the back of a strong Artificial Intelligence Strategy, the country also aims to integrate AI across various sectors, including healthcare, transportation, and government services. These notable achievements make the UAE an attractive destination for data centre investments, with investors viewing it as a safe and dependable option.

Delving into the multitude of factors influencing and enabling the investment environment, JLL’s whitepaper highlights the role of hyperscalers in shaping a thriving data centre market in the region. While the Middle East is attracting substantial investments from top hyperscalers and major cloud providers such as Amazon Web Services and Microsoft, the UAE currently has the largest presence of hyperscalers in the region. These companies have announced novel cloud availability zones slated for deployment through their data centres in the country, augmenting business competitiveness by providing advanced architecture and robust end-to-end security for seamless business operations and reliable disaster recovery solutions.

“At a time when data has come to define the parameters of innovation, efficiency, and competitiveness, not only in real estate but across industries, the UAE is boldly leading the charge in the data centre domain in the region. Through strategic investments in smart city infrastructure, a robust AI strategy, and a visionary approach to talent development, the country is not only becoming an investment hub; it is positioning itself for even greater success ahead. Initiatives like the ‘National Cybersecurity Strategy’ further underlines UAE’s commitment to digital trust, making it not only a regional data centre leader but also a bastion of security and reliability,” said Faraz Ahmed, Associate, Research at JLL MENA.

“With each stride in innovation, the UAE propels itself to new heights of digital excellence and economic vitality. It is clear that its current momentum will only accelerate, cementing its standing in the realm of data centres and strengthening the region’s position on the global stage,” he added.

Whilst the data center market in the Middle East and Africa is still in its early stages of development, it is growing rapidly. The region is expected to be one of the fastest-growing data center markets in the coming years, given its strong potential for expansion to bridge the gap between limited supply and growing demand. At present, around 73 colocation facilities are operational across the UAE, Saudi Arabia, Qatar, Oman, and Kuwait.