Market Trends of UAE Data Center Construction Industry
BFSI to have significant market share
- BFSI and e-commerce are the major end-user segments, expected to showcase significant growth during the forecast period. Regarding adopting digital banking, the UAE comes in sixth position globally.
- A survey by the Australian financial comparison website Finder predicts that by the end of 2027, the number of UAE residents using digital banking will rise by 22 percentage points to 41%. About 19% of the UAE customers polled said they had a digital bank account, and another 15% said they planned to get one in the upcoming year.
- As a result, adoption will reach a predicted level of 34% in the current year. According to research conducted by Merchant Machine, the United Arab Emirates is expected to show significant market growth in e-commerce.
- It further predicted that the percent change in the e-commerce market size over the current year would be nearly 23.11%, with e-commerce spending accounting for 1.1% of the country's GDP. The other end-user and telecom segments are also expected to show significant growth.
- The rapidly increasing 4G penetration and the upcoming 5G wave further motivate telecom vendors to invest in the UAE data center market. According to the Telecommunications Regulatory Authority (UAE), over 18.7 million active mobile phone subscribers were in March 2022.
Understand The Key Trends Shaping This Market
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Abu Dhabi and Dubai are the major hotspots for data center construction
- Abu Dhabi and Dubai are the major hotspots in the country. The data center market in Abu Dhabi reached an IT load capacity of 88.01 MW in 2022, and it is expected to record a CAGR of 14.32% to reach a capacity of 352.91 MW by 2029.
- The data center market in Dubai reached an IT load capacity of 56.50 MW in 2022, and it is expected to witness a CAGR of 19.46% to reach a capacity of 444.87 MW by 2029. Abu Dhabi has grown into a substantial, developed metropolis due to its quick urbanization and growth, as well as its enormous oil and gas reserves, output, and relatively high average income.
- It is a significant hub for culture and business, and it is the political and industrial hub of the nation. About two-thirds of the United Arab Emirates' USD 400 billion economy comes from Abu Dhabi. Key players such as Equinix and Khazana are investing in expanding their footprints across Abu Dhabi. For instance, during the forecast period, Khazana Abu Dhabi is expected to launch 10 facilities with an IT load capacity of 141.98 MW. Dubai is benefiting from a growing knowledge-based economy.
- Young millennials are attracted to Dubai because of the numerous reforms implemented, including the Golden Visa program and the development of digital infrastructure. The Department of Economy and Tourism (DET) at Dubai's Establishment for Small and Medium Enterprises Development (Dubai SME) announced the debut of Concept+, which is a brand-new business incubator that strongly emphasizes digital technology. The Rest of United Arab Emirates comprises Al Ain, Fujairah, and Kalba. These regions are in the process of adopting data center facilities.
