Home-grown data centre operator’s answer to AI demand: A three-country corridor

Home-grown firm Racks Central is making its boldest move yet: building a network of data centres across Singapore, Johor and Batam to meet South-east Asia’s surging demand for artificial intelligence (AI)-ready infrastructure, as businesses increasingly turn to AI for high-power, complex workloads.

The expansion is already taking shape. In Johor, Racks Central has acquired three land parcels totalling 88,625 sq m, where it is developing 510MW of capacity purpose-built for AI workloads – which demand far more power and sophisticated cooling than traditional computing. In Batam, the company is building a 120MW facility with 12,280 sq m of usable space. Designed for large-scale, high performance computing, the modular facility in Batam allows clients to expand their operations with more flexibility across the region.

“We are building a seamless infrastructure, a regional AI corridor across all three markets, and they complement each other,” says chief executive and co-founder Bobby Wee.

The strategy leverages complementary strengths of Singapore, Johor and the Riau Islands. For example, Johor offers abundant land and the space needed to build the large-scale facilities AI computing demands. Business costs are lower in Johor too.

“Singapore is a Tier-1 market, but it has constraints in power and land,” he adds. “In Johor, you have scale and power. In Batam, you have cost efficiency, plus access to Java Island, which gives you that critical mass needed for the business to scale.”

Growth of the digital economy

Founded in 2014 by Mr Wee, Racks Central started operations at a single-floor data centre at Tai Seng Drive in Singapore, serving enterprise customers with relatively modest computing needs.

Today, that same location houses a six-storey facility with 12MW of capacity, supporting a wide mix of users – from e-commerce platforms and technology firms to cloud service providers, telecommunications operators and IT service companies. The growth reflects not just the company’s success, but the rapid expansion of South-east Asia’s digital economy over the past decade.

What turbocharged this shift was the Covid-19 pandemic. As lockdowns swept the region, businesses scrambled online. E-commerce boomed, streaming surged and video calls became essential.

Cloud migrations planned for years were compressed into months. Demand for data centre space soared and did not fade when lockdowns ended. It became the new normal.

The numbers reflect this. The company’s revenue more than doubled from $14.9 million in FY2021 to $32.8 million in FY2024, driven by cloud adoption, e-commerce growth and digital transformation across the region.

That performance has earned Racks Central a spot on the 2026 list of Singapore’s Fastest Growing Companies, compiled by The Straits Times and global research firm Statista.

New AI infrastructure

That momentum has since carried into the AI era. Companies are now deploying increasingly complex workloads that require dense computing clusters, sustained high power loads and advanced cooling systems – capabilities that traditional data centres were not designed to support.

Racks Central is responding on two fronts: first, by upgrading its infrastructure to handle next-generation computing demands; and second, by expanding its footprint beyond Singapore.

The Johor and Batam developments represent a response to that structural shift. By building new facilities from the ground up, rather than retrofitting older ones, the company is positioning itself to support the next wave of digital growth across South-east Asia.

The opportunity is substantial. According to

a study by the Asia-Pacific Data Centre Association

, commissioned by Amazon Web Services, data centres already contribute over $2 billion annually to Singapore’s economy and support 25,000 jobs, with direct roles paying 35 per cent above the national salary average. By 2030, the sector is expected to create nearly three times as many jobs and contribute almost nine times more to the economy than it did in 2022.

But capturing that growth requires looking beyond Singapore’s borders, where land and power are cost pressures.

The expansion will also drive hiring. Racks Central expects to grow from around 50 employees in Singapore and Malaysia to about 70 by the end of 2026. The company currently has 40 employees based in Singapore handling engineering, operations, construction management and customer support.

Looking ahead, Mr Wee sees the industry at a defining moment.

“Cloud, telco and graphics processing unit infrastructure are converging. The next 10 years will define digital infrastructure in Asia. We want to help shape it.”

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