Google to Develop More Malaysia Data Centres with Sime Darby

Two months after breaking ground on Google’s first data centre in Malaysia, Sime Darby Property has announced a fresh build-and-lease agreement that will see the development of additional facilities for the US tech giant.

The deal builds on the collaboration announced in May by Google and Sime Darby Property, a real estate unit of the Malaysian conglomerate, under which the Silicon Valley-based goliath is investing $2 billion to develop its first data centres and cloud region in the country.

The additional data centres will be built near the maiden hyperscale project at Sime Darby Property’s Elmina Business Park in Selangor state northwest of Kuala Lumpur, the company said Monday in a release. The inaugural data centre began construction in early October and is expected to be completed in early 2026.

“This agreement reflects Sime Darby Property’s ability to deliver, own, and lease data centres that meet the demands of the global digital economy, exemplifying the technical sophistication and operational reliability required for mission-critical, complex infrastructure assets,” said Sime Darby Property managing director Azmir Merican.

20-Year Lease

Infrastructure development is underway at Elmina Business Park for the future facilities, with completion of construction targeted for 2027. The parties will then enter a 20-year lease valued at up to MYR 5.6 billion ($1.2 billion), with options to renew for two additional five-year terms, Sime Darby Property said.

To date, Sime Darby Property is Malaysia’s only developer to execute a built-to-suit lease for a data centre. The company’s drawing card is the 1,500 acre (607 hectare) industrial township of Elmina Business Park, billed as the largest freehold industrial business hub in Malaysia’s Klang Valley surrounding the capital region.

“The presence of these data centres in Elmina Business Park enhances Selangor’s attractiveness as a key digital hub for Malaysia, buoyed by Selangor’s well-developed infrastructure, business-friendly policies, and collaborative efforts of authorities,” Azmir said.

Operational data centre capacity in Malaysia soared 80 percent in the first half of 2024 compared with the previous six-month period to lead all Asia Pacific nations in growth, according to a Cushman & Wakefield report.

The surge was driven by activity in Johor, with the southern state having reached 1.9 gigawatts of existing and committed capacity — putting it on the brink of joining the region’s four 2GW-plus markets, namely Beijing (2.9GW), Tokyo (2.7GW), Shanghai (2GW) and Sydney (2GW).

Southeast Asia Search

The update of Google’s Malaysia plan follows the September announcement of the search engine titan’s $1 billion investment to expand its digital infrastructure into Thailand, including plans for a data centre in the country’s eastern industrial heartland and a public cloud location in Bangkok.

Google’s first Thai data centre will take shape at an industrial estate of warehouse builder WHA in the Eastern Economic Corridor of Chonburi province, while the capital city will host a cloud region, defined as a collection of computing and storage resources with high-performance network connections.

No technical specifications were disclosed, but Google said the investment could potentially add $4 billion to Thailand’s GDP by 2029 and support an average of 14,000 jobs annually from 2025 through 2029.

Google has operational data centres in 11 countries, including four facilities in Singapore and one each in Japan and Taiwan.