Middle East & Africa Data Center Construction Industry Outlook Report 2023-2028: On-Premises Infrastructure Migrating to Colocation & Managed Services Bolstering Growth

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Jul 04, 2023, 06:30 ET

DUBLIN, July 4, 2023 /PRNewswire/ -- The "Middle East & Africa Data Center Construction Market - Industry Outlook & Forecast 2023-2028" report has been added to ResearchAndMarkets.com's offering.

The Middle East and Africa data center construction market is expected to reach a value of $4.26 billion by 2028 from $2.6 billion in 2022, growing at a CAGR of 8.54% from 2022-2028

The region's major global cloud service providers include Amazon Web Services, Tencent Cloud, Microsoft, Google Cloud, Alibaba Cloud, Oracle, and Huawei Technologies. For instance, Microsoft announced its intention to open a cloud region in Saudi Arabia.

The Middle East and Africa data center construction market grows continuously in terms of connectivity by deploying new submarine cables such as Africa-1, 2Africa, India Europe Xpress (IEX), Raman, Saudi Vision, Blue, Equiano, Medusa Submarine Cable System, and SeaMeWe - 6, which are expected to be ready for services during the forecast period.

The introduction of the 5G network in the Middle East & Africa is likely to generate a substantial amount of data, which will further lead to increasing investments in data centers. High internet connectivity, bandwidth, and less processing time is the feature of 5G technology.

The countries like the UAE, Saudi Arabia, South Africa, Oman, Kuwait, Bahrain, Kenya, Nigeria, and Qatar commercially deployed 5G network services. Turkey, Israel, Ethiopia, Algeria, Ghana, Jordan, Lebanon, and Iran are other countries in 5G planning and are yet to deploy commercial services during the forecast period.

Rise in the Procurement of Renewable Energy Sources

The Middle East and Africa have an abundance of availability of solar energy, where most of the countries in the region are undertaking renewable energy strategies & visions to develop renewable energy projects and meet the region's carbon-neutral goals set by respective governments.

In December 2022, Saudi Arabia announced the development of 10 renewable energy projects with a power capacity of 7 GW, which is part of the Kingdom's 2030 Vision.

In June 2022, Vantage Data Centers signed 20 years Power Purchase Agreement (PPA) with SolarAfrica in which the company will procure 87 MWp of solar energy that will be used to power its new facility.

In the UAE, the Energy Strategy 2050 aims to increase the share of renewable energy from 25% to 50% in the total energy mix by 2050.
Saudi Arabia has launched The National Renewable Energy Program (NREP) under Vision 2030, where 13 projects will generate over 4.8 GW of renewable energy. In addition, Bahrain plans to generate around 280 MW of electricity from renewable sources by 2025, increasing to around 700 MW by 2030 to attain national renewable energy targets.

In July 2022, the Nigerian government made a statement regarding its commitment to the sustainability goal for 2030. The government is planning to generate 30 GW of electricity from renewable sources by generating renewable energy as 30% of its total production.

Increasing Cloud Investments

The increase in digitalization and the shift of workloads to cloud platforms from on-premises facilities to make their operations more efficient and scalable witnessed the increase in investments by cloud service providers in the Middle East and Africa over the last few years.

Amazon Web Services aims to develop the infrastructure region in Tel Aviv, Israel, which will likely be operational in 2023.

In September 2022, Google Cloud announced its plan to open a new cloud region in Cape Town, South Africa. The cloud region is expected to be operational in the next 2-3 years.

In 2022, Google Cloud launched its first local cloud region in Israel. Further, Amazon outpost cloud services were deployed for the first time in Oman in the Oman Data Park, and Microsoft Azure established its first global data center region in Qatar.

GEOGRAPHICAL ANALYSIS

UAE dominates the regional market in terms of data center developments. In addition, Saudi Arabia, South Africa, Israel, Kenya, and Oman are among the major contributors to high data center development activities in the Middle East and Africa data center construction market. Qatar, Nigeria, Bahrain, Egypt, Ethiopia, and Kuwait are emerging markets that witness significant growth due to digitalization and growth in connectivity.

In the Middle East & Africa, the presence of smart cities in the region also drives data center investments. The UAE, Saudi Arabia, South Africa, Kenya, Kuwait, Morocco, Nigeria, Egypt, Ethiopia, and Ghana are some of the major countries in the region which triggered the smart city investments.

For instance, the NEOM project in Saudi Arabia is under development as a part of Crown Prince Mohammed bin Salman's Vision 2030, which will also comprise the data center development under a joint venture firm ZeroPoint DC.

KEY MARKET PARTICIPANTS' INITIATIVES

The surge in data center activities across the region will be a major source of revenue for construction contractors.

Some prominent local and global construction contractors in the Middle East and Africa data center construction market include AECOM, Laing O'Rourke, Dar Group, Mercury Engineering, Deerns, Anel Group, Linesight, M+W, McLaren Construction, Atkins, B2 Architects, ENMAR Engineering, Arup, DC Pro Engineering, Edarat, Sterling & Wilson, United Egypt, Westwood Management, HHM Building Contracting, Red Engineering, and Turner & Townsend.

For instance, Laing O'Rourke is selected by Khazna Data Centres to design and build a facility and office space in Dubai Design District.

SEGMENTATION INSIGHTS

Most facilities are being developed to operate at a PUE of less than 1.5. In contrast, few facilities in countries like Turkey that adopt partial free cooling during peak winters aim to operate at a PUE of less than 1.3.

Data centers are investing in power infrastructure with a minimum of N+1 redundancy. In 2022, UPS systems accounted for a market share of more than 30% of the total electrical infrastructure in data centers.

The Middle East and Africa data center construction market is investing in cooling infrastructure due to the high-temperature climate in some countries. In 2022, cooling systems service providers invested a share of more than 65% of the total mechanical infrastructure.

KEY QUESTIONS ANSWERED:

How big is the Middle East and Africa data center construction market?
What is the growth rate of the Middle East and Africa data center construction market?
What is the estimated market size in terms of area in the Middle East and Africa data center construction market by 2028?
Who are the new entrants in the Middle East and Africa data center construction market?
How many MW of power capacity is expected to reach the Middle East and Africa data center construction market by 2028?

Market Opportunities & Trends

Rising Adoption of Renewable Energy Sources
Increasing 5G Deployments Fueling Edge Data Center Investments
Deployment of Submarine Cables and Inland Connectivity
Smart City Initiatives Driving Data Center Investments
Increase in Adoption of Artificial Intelligence

Market Growth Enablers

Cloud Adoption Driving Data Center Investments
IoT & Big Data Fuelling Data Center Investments
On-Premises Infrastructure Migrating to Colocation & Managed Services
Deployment of Modular Data Centers

Market Restraints

Security Challenges in Data Centers
Dearth of Skilled Workforce
Location Constraints on the Development of Data Centers

Major Vendors

Prominent Support Infrastructure Providers

energy
ABB
Airedale
Alfa Laval
Canovate
Caterpillar
Cummins
Delta Electronics
EAE Group
EATON
Envicool
EVAPCO
Enlogic
HITEC Power Protection
Johnson Controls
Legrand
Master Power Technologies
Rittal
Rolls-Royce
Schneider Electric
Siemens
STULZ
Vertiv

Prominent Data Center Construction Contractors

AECOM
AlDar Properties
Anel Group
Arup
Ashi & Bushnag
Atkins
Abbeydale
Advanced Vision Morocco
ARSMAGNA
b2 Architects
CAP DC
Chess Enterprises
Copy Cat Group
Dar Group
DC Pro Engineering
Deerns
Eastra Solutions
Edarat
EGEC
ENMAR Engineering
EDS Engineers
Egypro
Harinsa Qatar (HQ)
HATCO
HHM Building Contracting
Hill International
H&MV Engineering
Ingenium
Interkel
ICS Nett
INT'LTEC
ISG
JLB Architects
Laing O'Rourke
Linesight
M+W Group (Exyte)
Mace
Mercury Engineering
McLaren Construction Group
MIS
MWK Engineering
NDA Group
Orascom Construction
Prota Engineering
Qatar Site & Power
RED Engineering
RW Armstrong
Royal HaskoningDHV
Shaker Group
Sterling & Wilson
Summit Technology Solutions
Sudlows
Telal Engineering & Contracting
Tri-Star Construction
Turner & Townsend
United Egypt
Westwood Management

Prominent Data Center Investors

st Century Technology
Africa Data Centres
Adgar Investments and Development
Amazon Web Services (AWS)
Batelco
Bynet Data Communications
Digital Parks Africa
Equinix
Etisalat
EdgeConneX
Future Digital Data Systems
G42
Gulf Data Hub
Google
Galaxy Backbone
icolo.io (Digital Realty)
IXAfrica
Khazna Data Centers
Moro Hub
MedOne
MEEZA
Mobily
MainOne
Medallion Communications
Microsoft
NTT Global Data Centers
Oman Data Park
Ooredoo
Paratus Namibia
Rack Centre
Raxio Data Centres
stc
Serverfarm
Turkcell
Turk Telekom
Telehouse
Telecom Egypt
Teraco (Digital Realty)
Tencent Cloud
Wingu

New Entrants

Airtel Nigeria
Cloudoon
Compass Datacenters
Digital Realty
EDGNEX
Global Technical Realty
Infinity
Kasi Cloud
Open Access Data Centres (OADC)
Vantage Data Centers
Quantum Switch
ZeroPoint DC

SEGMENTS ANALYSIS

Infrastructure

Electrical Infrastructure
Mechanical Infrastructure
General Construction

Electrical Infrastructure

UPS Systems
Generators
Transfer Switches & Switchgear
PDUs
Other Electrical Infrastructure

Mechanical Infrastructure

Cooling Systems
Racks
Other Mechanical Infrastructure

Cooling Systems

CRAC and CRAH Units
Chillers Units
Cooling Towers, Condensers, and Dry Coolers
Other Cooling Units

Cooling Techniques

Air-based Cooling
Liquid-based Cooling

General Construction

Core & Shell Development
Installation & Commissioning Services
Engineering & Building Design
Fire Detection & Suppression
Physical Security
DCIM/BMS Solutions

Tier Standard

Tier I & Tier II
Tier III
Tier IV

For more information about this report visit https://www.researchandmarkets.com/r/b3fbna

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