Real Estate Players Eye Edge Data Centres: Tier 2 Cities Gain Traction
The real estate sector is witnessing a significant shift towards edge data centres, with Tier 2 cities like Faridabad gaining prominence due to their strategic connectivity and infrastructure readiness.
Edge Data CentresReal EstateTier 2 CitiesDigital InfrastructureData Centre CapacityReal Estate NewsJun 01, 2025
Executives of real estate firms highlight that emerging hubs like Faridabad, among many Tier 2 cities, are gaining attention for their strategic connectivity and infrastructure readiness. These cities, with their abundant and affordable land, are being eyed for new developments, particularly for edge data centres where proximity to local users is critical.
Uddhav Poddar, CMD of Bhumika Group, emphasizes the growing investment in data centres, projected to reach USD 20-25 billion by 2030, as a clear sign of how digital infrastructure is becoming central to India's growth story. 'Emerging hubs like Faridabad are gaining attention for their strategic connectivity and infrastructure readiness,' he said. Poddar further elaborates that developers must focus on 'power availability, connectivity, and compliance with technical requirements that go beyond traditional commercial or industrial spaces.' This means that real estate development for data centres requires a unique blend of technical expertise and strategic location planning.
According to a report by real estate and investment firm Colliers, while hyperscale data centres have dominated the narrative so far, the evolution of edge data centres is on the rise. Hyperscale data centres are large facilities designed to handle massive amounts of data, compute, and storage needs, typically used by large internet companies and cloud service providers. 'Interestingly, the market is expanding beyond large-scale colocation facilities and hyperscalers to edge data centres driven by the increasing need for lower latency, real-time analysis, enhanced app performance, and business agility,' said Jatin Shah, Chief Operating Officer, Colliers India.
India's data centre capacity has grown over 4X times in the last 6-7 years and stands at 1,263 MW as of April 2025. It is expected to cross 4,500 MW by 2030 with an investment of USD 20-25 billion, as per the Colliers report. On the supply front, India has witnessed 859 MW of capacity addition across the top seven primary data centre markets since the beginning of 2020. In terms of geographical spread, 44 per cent of the new supply since 2020 was concentrated in Mumbai. This was followed by Chennai and Delhi NCR, which together accounted for 42 per cent of the capacity addition since 2020.
Frequently Asked Questions
What are edge data centres?
Edge data centres are small, localised data processing facilities situated close to devices and end users. They help in enhancing performance and efficiency for real-time applications by reducing latency and improving data processing speed.
Why are Tier 2 cities like Faridabad gaining attention for data centre development?
Tier 2 cities like Faridabad are gaining attention for their strategic connectivity, infrastructure readiness, and abundant affordable land. These factors make them ideal for developing edge data centres, which require proximity to local users.
What is the projected investment in data centres by 2030?
The projected investment in data centres by 2030 is estimated to be USD 20-25 billion, highlighting the growing importance of digital infrastructure in India's growth story.
What is the current data centre capacity in India, and what is the expected growth by 2030?
India's data centre capacity currently stands at 1,263 MW as of April 2025. It is expected to cross 4,500 MW by 2030, driven by the increasing demand for digital infrastructure.
What are the key factors developers must consider when building data centres?
Developers must focus on power availability, connectivity, and compliance with technical requirements that go beyond traditional commercial or industrial spaces. These factors are crucial for ensuring the efficient and reliable operation of data centres.
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