Middle-East data center construction market to hit $2.86 bn in 2028

According to Arizton’s latest research report, the Middle East data center construction market will grow at a CAGR of 7.59% during 2022-2028.

Israel, Saudi Arabia, the United Arab Emirates, Bahrain, Oman, Kuwait, and Turkey are the Middle East’s top data center construction markets. The Middle East region has several smart cities, including Abu Dhabi and Dubai, which saw investments in data center construction because of the rising need for data processing and storage. During 2023-2028 seven submarine cables are expected to come online, which is anticipated to increase demand for data centers.

Key Insights

• The surge in data center activities across the country will be a major source of revenue for construction contractors. Some prominent local and global construction contractors in the Middle East data center construction market include AECOM, Laing O’Rourke, Dar
• Group, AlDar Properties, Mercury Engineering, Deerns, Anel Group, ENMAR Engineering, Arup, DC Pro Engineering, Edarat, HHM
• Building Contracting, and Red Engineering. For instance, Laing O’Rourke is selected by Khazna Data Centres to design and build a facility and office space in Dubai Design District.
• Colocation Service Providers such as Khazna Data Centres and Gulf Data Hub are the major data center operators with over ten existing facilities in the region. At the same time, the Middle Eastern region is witnessing potential growth through these providers by developing more facilities across UAE, Saudi Arabia, Oman, Kuwait, Qatar, and Bahrain which are expected to be operational during the forecast period.
• The increase in demand across different industries in the region has led operators to sign several M&A contracts and enter joint ventures (JVs) to expand their portfolios in Saudi Arabia. For instance, In September 2022, Khazna Data Centers and BEEAH Digital formed a JV termed One Data Center SPV. The newly formed company plans to build a 9-MW data center in Sharjah, UAE.

Deployment of Modular Data Centers Major Drivers in the Middle East Data Center Construction Market
The Middle East is a developing data center market dominated by telecommunications operators investing in colocation data center facilities. To reduce network latency, many telecommunication providers are deploying modular data centers. They are usually deployed in remote locations to balance the demand for low latency with investment and power usage and can also be used to meet the demand for high power density in many cases.

Modular data center facilities handle systems with a UPS capacity of less than 500 kVA and lower rack density. Deploying modular data centers will also increase the demand for innovative modular infrastructure offerings, including rack PDUs, UPS systems, cables, and sensors. Hence, vendors are innovating to cater to the requirement of modular data center adopters. Vendors like Huawei Technologies, Vertiv, Schneider Electric, and ABB offer modular data center solutions.

CT Bureau