The real estate market in Thailand, like many across the world, moves in cycles. We’ve seen the rise and fall of various sectors, and as we speak, office real estate is experiencing a notable decline, while the residential sector remains stagnant. This lull in two of the most prominent areas of real estate signals that it’s time for a new solution, a new cycle. The answer to that may lie in the booming demand for Data Centers.
As internet usage continues to surge, and with more people and businesses relying on digital infrastructure, Thailand finds itself at a crossroads. The current supply of data centers is far from sufficient to meet the country’s growing needs. Global giants like Microsoft, AWS, and Google have taken notice, expanding their operations into Thailand. In parallel, global development funds are also moving into the country, seeing the data center market as a key investment opportunity.
This isn’t just about filling an immediate gap—it’s the beginning of a new cycle in Thailand’s real estate development. Data Centers, with their increasing importance in today’s digital age, could become the next major sector, offering an alternative to traditional real estate investments.
Both the central business districts (CBDs) and suburban areas present unique advantages for data center development. CBDs provide proximity to key enterprises and financial institutions, which benefit from low-latency, high-performance computing. On the other hand, suburban areas offer larger spaces, lower costs, and room for expansion—ideal for large-scale, hyperscale data centers that support global digital infrastructure.
The Thai government recognizes the potential of this new cycle and is actively promoting Data Center development through incentives and support packages. This makes it easier for developers to capitalize on this opportunity. However, there’s a challenge we must address—ensuring that data centers integrate well with their surrounding environments. Misaligned development could disrupt the balance of these areas, which is something we must navigate carefully.
One approach to overcome this is to repurpose underutilized office buildings. With the office market in decline, data centers provide an opportunity to breathe new life into these assets. At PIDC, we are already taking steps in this direction with our focus on EDGE Data Center development. These smaller, high-performance data centers can be housed in existing office towers, bringing technology infrastructure closer to end-users and revitalizing dormant properties in the process.
Thailand office market: Vacant rate 2020-2025
Thailand office market: Occupancy rate by Grade (Knight Frank)
At PIDC, we are not only prepared for this new cycle but are actively shaping it. Our expertise in both real estate and Data Center development allows us to leverage this growing market, providing global tech companies and development funds with the infrastructure they need to succeed. Whether through large-scale developments or converting office buildings into edge data centers, PIDC is committed to leading the way in Thailand’s next real estate revolution.
The real estate landscape is shifting, and those who adapt will thrive. Data centers represent more than just a new type of infrastructure—they are the foundation for the next cycle of growth in Thailand’s real estate market.
In many ways, this shift toward Data Center development mirrors previous real estate cycles where new demands reshaped the landscape. Just as residential or commercial booms once defined real estate, data centers could become the next significant driver of growth. And unlike traditional real estate, data centers are driven by the exponential rise of digital activity, which shows no signs of slowing down.
The views expressed in this commentary are the personal views of the authors and do not necessarily reflect the views of PIDC. The views expressed reflect the current views of the authors as of the date hereof, and neither the authors nor PIDC undertake any responsibility to advise you of any changes in the views expressed herein.
