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Keppel, Salim Group to build new datacentre in Indonesia

The facility located on the outskirts of Jakarta is a response to the growing demand for connectivity and data services in Indonesia’s fast-growing digital economy

Singapore’s Keppel Group and Indonesia’s Salim Group are building a new datacentre in Bogor, about 35km distance from Jakarta, in a joint venture, underscoring Indonesia’s growing demand for connectivity and data services.

Dubbed IndoKeppel Data Centre 1 (IKDC 1), the datacentre will be operated by Keppel and Salim Group over three phases and will feature a gross floor area of about 105,300ft2 with Tier 3 concurrent maintainability standards for power and cooling.

The construction of the datacentre’s core and shell as well as first-phase fit-out is expected to be completed by the first half of 2020.

Separately, IKDC 1 and its underlying 3ha land plot will be held by a 60-40 joint venture between Salim Group and the Alpha DC Fund, an investment fund managed by Alpha Investment Partners.

The land plot will be the first phase of a larger 7ha datacentre campus development that will cater to growing demand for quality datacentre space in Indonesia.

Salim Group, one of Indonesia’s biggest conglomerates with diversified businesses including food, banking and telecoms, currently owns and operates a datacentre in Indonesia serving financial institutions and enterprise customers.

“For the past decade, the group has been keen on preparing and expanding its Salim Digital Ecosystem to support the nation’s transformation to Industry 4.0,” said Sugiharto Darmakusuma, director of Salim Group.

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“We have been actively investing in fibre connectivity for the past decade and now we are, I believe, one of the very few players in Indonesia who have this capability. We have fibre optics cables laid out all across Sumatra, Java all the way to Bali. We also have invested in our own submarine cables from Java to Singapore.

“With our extensive fibre optic connectivity throughout Indonesia and Keppel Data Centres presence across the globe, we believe that we have met a perfect match to take part in the smart industry revolution.”

Alvin Mah, CEO of Alpha Investment Partners, noted that Indonesia’s population of over 260 million makes it the largest base of internet users in the region. With internet penetration currently at about 50%, he said e-commerce and cloud service providers are realising the market’s potential and are looking to make inroads, in turn bolstering data centre demand.

According to a PricewaterhouseCoopers report, Indonesia’s datacentre market is one of the fastest growing in the region, with a compound annual growth rate of 35%.

Positive growth drivers such as data sovereignty requirements, increased smartphone adoption and the growing popularity of e-commerce are expected to generate healthy demand for quality datacentres with high resiliency.

Although Indonesia is vying for a slice of the region’s booming datacentre market, Hong Kong and Singapore will remain the primary destinations for datacentre deployments in the region for the foreseeable future, according to 451 Research.

Economic gateways

Singapore and Hong Kong have traditionally served as gateways to their economic hinterlands of Southeast Asia and China, respectively, drawing datacentre providers to open facilities in the two cities to support the region’s growing digital economy.

Earlier this month, Facebook said it is building its first Asian datacentre in Singapore due to the city-state’s robust infrastructure and access to fibre connectivity, a talented local workforce, as well as support from government agencies.

“Singapore has also established policies that foster a business-friendly environment, including measures that support the enforcement of contracts and increase the ease of construction permitting. The World Bank recently named Singapore as the number one country in Asia to do business,” it said.

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