Region poised for huge investment in data centres
25 February 2025
The six GCC states are experiencing a boom in data centre construction. A massive rise in demand and regulatory requirements insisting on the in-country retention of data is driving this growth, along with the rise of power-hungry artificial intelligence (AI) applications.
Today, there are more than 115 data centre projects in the pipeline, with an investment value of more than $20bn.
These are led by major international players such as Amazon Web Services, Google and Huawei, which are catching up to increase capacity for the provision of local services, and by local players such as UAE-based data centre and cloud services provider Khazna Data Centres, which has been encouraged and supported by the government to develop home-grown expertise.
There are more than a dozen data centres with an individual construction value of more than $100m currently under tender in the region, with the same again expected to go to market over the next 6-12 months.
In total, the Middle East’s data centre construction market is projected to reach $4.39bn by 2029, growing at a compound annual growth rate of 10.99%.
Due to the often sensitive nature of data centres, keeping track of specific projects can be difficult
Major investment
According to the latest available data from regional projects tracker MEED Projects, over $10.6bn-worth of data centres, some catering to hyperscalers such as Amazon Web Services and Microsoft, are planned to be developed and built in the GCC states.
This is a conservative estimate, given potential investments such as the $5bn planned between US asset investment firm KKR and the UAE-based Gulf Data Hub, and the $5bn Oxagon data centre project announced by Saudi gigaproject developer Neom and Saudi Arabia- based DataVolt. It also excludes spending by government entities to develop AI capabilities in defence, security, healthcare and energy.
The UAE has the highest concentration of data centres, while Saudi Arabia is the fastest-growing regional market, with both countries, along with Qatar, aiming to be digital hubs and key players in AI.
Globally, total investment in data centres reached $70.6bn in 2024 and is projected to grow by 5% to $74.3bn in 2025, according to GlobalData.
For more information and sample pages from MEED Insight’s GCC Data Centre Projects Market 2025 premium intelligence report, please click here
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Employment and investment opportunities in a low or no-tax environment have been key attractions for people and businesses located in the GCC for decades. Another crucial factor has been safety and security.
That reputation has been tested by the missile and drone attacks that began on 28 February. Whether the GCC’s safe haven status has been damaged depends on perspective.
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Developer plans two residential schemes in Saudi Arabia
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