New Zealand Data Center Colocation Market to Reach $949.75 Million by 2030, Driven by Demand for AI and Cloud Services.

New Zealand's data center colocation market is expected to grow at a CAGR of 3.84% from 2025 to 2030, driven by digital transformation, cloud services, and infrastructure advancements. The market was valued at USD 757.36 million in 2024 and is projected to reach USD 949.75 million by 2030. The increasing demand for AI, big data, and IoT is expected to fuel the growth of the market.

New Zealand's data center colocation market is poised for significant growth, with a projected Compound Annual Growth Rate (CAGR) of 3.84% from 2025 to 2030. The market, valued at USD 757.36 million in 2024, is expected to reach USD 949.75 million by 2030 [1].

Several factors are driving this growth, including digital transformation initiatives, rising demand for sustainable solutions, and the expansion of cloud services. The market is supported by advancements in infrastructure that improve efficiency, the growing need for storage and processing capabilities, and favorable government policies [2].

The New Zealand colocation market is characterized by a robust presence of over 33 data center facilities, with Auckland being a key player. The city hosts around 16 data centers operated by companies such as Datacom, Chorus, and Spark Digital. This location is favored due to its digitalization efforts and robust network infrastructure [1].

The increasing adoption of AI, big data, and IoT is a significant driver of demand for colocation services. The demand is further fueled by the presence of several cloud providers and the need for efficient processing capabilities. However, a shift is anticipated as sectors like telecom and enterprise migrate workloads to the cloud, although the cloud sector will sustain demand growth [1].

Foreign investments in colocation data centers are regulated by the New Zealand Overseas Investment Office. This regulation impacts land acquisitions and asset development, particularly as hyperscale companies like Microsoft and Amazon Web Services enter the market, influencing industrial land prices [1].

New Zealand is committed to reducing carbon emissions by 50% by 2030 and achieving carbon-neutrality by 2050. Various initiatives are underway, such as the expansion of Datagrid's renewable energy-enabled data center park. Operators like CDC Data Centres and NEXTDC are aligning their operations with these environmental goals [1].

The market is expected to see a high occupancy rate, exceeding 94% within the forecast period, driven by rising demand for colocation services. The demand is generated by sectors such as telecom, cloud, government, enterprise, and others. However, the demand from these sectors is expected to decline as businesses migrate their workloads to the cloud for data storage and processing [1].

The New Zealand data center colocation market presents significant opportunities for investors and infrastructure providers. The market's growth is supported by digital transformation, cloud services, and sustainability initiatives, making it an attractive proposition for both existing and new market entrants.

References:
[1] https://www.globenewswire.com/news-release/2025/08/22/3137748/28124/en/New-Zealand-Data-Center-Colocation-Market-2025-2030-Foreign-Investments-and-Sustainability-Initiatives-Catalyze-Growth-in-Colocation-Facilities.html
[2] https://www.businesswire.com/news/home/20250826432857/en/Investment-Opportunities-in-New-Zealands-Data-Center-Colocation-Market-2025-2030---Demand-for-AI-and-Cloud-Services-to-Fuel-Colocation-Boom-in-NZ---ResearchAndMarkets.com