Hong Kong’s Gaw Capital Partners on Friday announced the launch of a Singapore-based joint venture company, Data Center First, with a project in the nearby Indonesian city of Batam.
Industry veteran Wong Ka Vin leads Data Center First as co-founder and chief executive of the venture, which represents Gaw’s first investment in its Asian data centre platform outside of China, the private equity firm said in a release.
In addition to the maiden project at Nongsa Digital Park in Batam, roughly 30 kilometres (18.6 miles) across the Singapore Strait from the Lion City, Gaw will work with Data Center First to originate, evaluate and develop projects in Southeast Asia and beyond.
“I am excited to be working with Ka Vin and his team of professionals in creating this data centre operating platform,” said president and managing principal Kenneth Gaw. “It signals a key milestone in Gaw Capital Partners’ growth in the data centre industry, an industry that enables digital transformation opportunities for organisations globally to continue to grow.”
Southeast Asian Expertise
Gaw plans to increase its regional data centre footprint rapidly through a combination of multiple asset and platform acquisitions, a strategy given a boost earlier this month when the firm brought aboard former Keppel Data Centres executive Kok-Chye Ong as managing director and head of internet data centres ex-China.
To maintain that momentum, the family run outfit has now tapped Wong, whose track record includes building data centre platforms at US giant Equinix, Malaysia’s CSF Asia and the 1-Net unit of Singapore’s Mediacorp. While at 1-Net, Wong led the construction in Singapore’s Woodlands area of 1-Net North, a 30MVA facility which was acquired by Keppel DC REIT in 2019 for S$200.2 million (now $147.2 million).
A computer science graduate of Sheffield Hallam University, Wong spent his early career as a marketing director in the telecom division of HP and as senior vice president for business development at ST Telemedia in Singapore.
Batam’s Bit Barn Hotspot
The Straits Times reported last month that 20 data centre operators were considering the possibility of setting up shop at Nongsa Digital Park, with at least one sealing the deal after President Joko Widodo designated the campus a special economic zone.
The story identified Data Center First’s Wong as the buyer of 2.75 hectares (6.8 acres) of land at the park to build multiple facilities customised for clients such as banks, telecom firms and e-commerce businesses.
Some 25 hectares at the park has been set aside for data centre development in the first phase, with room for expansion. Operators told the Straits Times that Batam is attractive because it is relatively sheltered from natural disasters, geographically close to Singapore and part of a market of 270 million people.
Building Into a Boom
Gaw’s launch of an APAC data centre platform comes less than two years after the private equity shop announced its entry into the sector in China.
In 2019, Gaw and Beijing-based Centrin Data set up a joint venture that formed the basis for the firm’s first data centre investment fund, targeting hyperscale facilities in China. The fund was seeded with a 6,400-rack facility built by Centrin in Kunshan, a city just outside Shanghai in China’s Jiangsu province.
Last September, Gaw announced a $1.3 billion closing for the fund, revealing that the Abu Dhabi Investment Authority was the largest backer of the vehicle among several global institutional investors said to have contributed. Gaw planned to use the fresh funding to invest in a portfolio of server facilities in China.
The data centre market in Asia Pacific is predicted to experience a compound annual growth rate of 12.9 percent from 2020 through 2027, when it is expected to reach $59.8 billion in value, according to a report last month by Renub Research.