Singapore’s Empyrion Digital Enters Japan with 25MW Tokyo Data Centre Project

Singapore-based Empyrion Digital is making its maiden investment in Japan with the planned development of a 25-megawatt, carrier-neutral data centre in central Tokyo.

The data centre developer and operator backed by Asia-focused infrastructure fund Seraya Partners will develop its JP1 facility in partnership with an unnamed local investor described by Empyrion as one of Japan’s largest diversified financial services groups, with construction expected to commence in 2025.

“Japan is a key market for digital innovation in Asia, and we are excited to contribute to its growth with JP1 in Tokyo,” Empyrion Digital CEO Mark Fong said in a release on Monday. “Our expansion into Japan signifies our commitment to providing world-class, future ready digital infrastructure that meets the diverse needs of our hyperscale and enterprise customers while continually improving sustainability and innovation.”

Empyrion’s entry into Japan comes as the Greater Tokyo area in the second quarter recorded a 14 percent increase in operational data centres from a year earlier, after surpassing one gigawatt in capacity during 2023, according to an August report from Cushman & Wakefield. With committed projects in the pipeline boosting the market’s capacity to 2.7GW, Greater Tokyo ranks second behind Beijing for Asia Pacific’s largest operational and planned resources.

AI Ready Facility

Situated in a “network dense” location within 5 kilometres (3 miles) of Tokyo’s Otemachi business district, JP1 is set out as a 5-storey building which will span 21,000 square metres of floor area upon its planned commissioning in late 2027.

The tier III data centre is designed to support generative AI and high performance computing workloads, and will be equipped with advanced cooling technologies to improve energy and water efficiency, according to the company.

“As the fourth largest economy in the world, Japan continues to be an important destination for infrastructure investments,” said Seraya Partners managing partner and CIO James Chern. “Seraya is excited to support Empyrion in securing trophy assets like JP1 Tokyo, demonstrating our team’s abilities in originating and developing these highly differentiated projects.”

Launched by Singapore-based Seraya Partners in 2021, Empyrion currently operates a 7.7MW data centre in Singapore and is building a 29.4MW facility in Seoul. The company is also exploring development of carrier-neutral facilities in Taiwan, Thailand, Indonesia, Malaysia and Vietnam and has identified additional site locations in Bangkok and Jakarta, according to Empyrion’s website.

“Our goal is to create the most competitive digital infrastructure platform in Asia to serve the growing needs of our customers,” said Fong. “With a proven track record of owning and operating an award-winning data centre in Singapore and the construction of our Korea KR1 data centre in Gangnam, Seoul, well underway, we are well-positioned to build on this Tokyo investment and capitalise on future opportunities in Tokyo and Osaka.”

Seraya, which invests along the themes of renewable energy and digital infrastructure, managed $800 million of assets as of 31 December, with more than half of that capital deployed as of July. The private equity firm counts BlackRock, the Asian Infrastructure Investment Bank, and Canada’s Alberta Investment Management Company among its investors, and is planning a second fund raising round next year.

Investors Pile In

Empyrion joins a growing list of investors entering or expanding in Japan’s data centre market as cloud adoption, data consumption and investment in artificial intelligence boost demand for digital infrastructure. Japan’s co-location market is projected to grow at a compound annual growth rate of 9.2 percent from 2023 to 2028, according to projections from consultancy Structure Research cited by Empyrion.

HKEX-listed industrial specialist ESR last week completed the 25MW first phase of its flagship data centre project in Osaka, with that milestone coming three months after the company announced plans to develop a 60MW Tokyo facility as its fourth data centre in Japan.

In July, Singapore’s Keppel DC REIT secured its first Japanese asset with the acquisition of a western Tokyo data centre from an unrelated third party for $140 million. That deal came just months after the trust’s sponsor, Keppel Ltd, inked a deal with Japanese real estate giant Mitsui Fudosan to explore data centre development and investment opportunities in Japan and Southeast Asia, including the proposed forward purchase of an under-development facility in western Tokyo that will mark Keppel’s first data centre project in Japan.

Earlier this year, a fund managed by Gaw Capital Partners acquired a third site for its data centre campus in western Tokyo’s Fuchu City area, with the deal enabling the Hong Kong-based private equity firm to double the project’s total IT capacity to 78MW upon completion.

Gaw’s acquisition came two months after a fund of Singapore-based data centre developer and operator Princeton Digital Group and Australian builder Lendlease completed construction of the 48MW first phase of its first Japanese data centre project in Tokyo’s Saitama City area.