Malaysia’s Data Centre Boom Sparks a Shift Away From Crowded Southern Hubs

Malaysia’s data centre expansion is prompting new location choices as infrastructure constraints tighten. Tanjong Malim stands-out, home to Proton’s car manufacturing plant and the upcoming BYD assembly facility, is officially designated as an Advanced High Technology Valley, supporting scalable, future-ready digital infrastructure development nationwide.

Kuala Lumpur, Malaysia, January 21, 2026 — Malaysia’s Data Centre Expansion Redefines Where Infrastructure Can Truly Scale

Power, Water and Industrial Clusters Drive a Shift Beyond Southern Defaults

Tanjong Malim’s Advanced High Technology Valley Gains Strategic Attention

Malaysia’s emergence as one of Asia Pacific’s fastest-growing data centre markets has placed the country firmly on the global digital infrastructure map. With strong government backing, rising cloud adoption and sustained foreign investment, the sector has entered a new phase—one defined less by speed and more by long-term resilience.

As operators move from early expansion to large-scale, multi-decade planning, a fundamental question is being reassessed: where can data centres continue to scale without encountering infrastructure bottlenecks?

THE NEXT STAGE OF DATA CENTRE GROWTH IN MALAYSIA IS ABOUT INFRASTRUCTURE HEADROOM, NOT JUST MARKET PROXIMITY

Southern Hubs Face the Limits of Success

Southern Johor, Cyberjaya and key areas of Selangor have long served as Malaysia’s default data centre destinations. Their proximity to Singapore, established fibre networks and early ecosystem maturity attracted the first wave of hyperscalers and colocation providers.

However, concentration is now revealing structural constraints. Power allocation timelines in southern Johor have lengthened as demand from data centres, manufacturing and residential growth converges. Water supply planning has similarly tightened, particularly for facilities requiring consistent cooling capacity.

Land economics have also shifted. Prime industrial parcels in these regions now command significantly higher prices, impacting project feasibility and long-term return profiles. For data centres designed to operate at scale over 20 to 30 years, these pressures are no longer marginal.

Cyberjaya, while retaining its symbolic status as Malaysia’s digital nucleus, faces land scarcity that limits large contiguous campus-style developments. Selangor’s broader industrial density means power and water resources are increasingly shared, complicating future expansion.

A Strategic Reassessment of Location

Rather than abandoning established hubs, developers are recalibrating their strategies. The focus is moving toward locations offering balanced access to power, water, land and industrial synergies, without the saturation risks now evident in southern clusters.

This shift has brought renewed attention to Tanjong Malim, a location historically associated with manufacturing and education, now emerging as a strategic node for advanced industries.

Situated along the north-south economic corridor linking the Klang Valley to northern Malaysia, Tanjong Malim provides accessibility without density, enabling connectivity while avoiding southern congestion.

Advanced High Technology Valley Anchors Industrial Depth

Tanjong Malim’s transformation is anchored by its designation as the Advanced High Technology Valley (AHTV), a national initiative aimed at creating a high-value industrial and technology ecosystem. AHTV integrates advanced manufacturing, automotive, electric vehicles, engineering, research and digital infrastructure within a single framework.

At the core is Proton City, home to Proton’s flagship car manufacturing plant. More recently, BYD’s upcoming electric vehicle assembly plant has reinforced Tanjong Malim’s role in Malaysia’s EV and high-technology ambitions.

DATA CENTRES ARE INCREASINGLY CO-LOCATING WITH ADVANCED MANUFACTURING AND EV CLUSTERS TO SUPPORT INDUSTRY 4.0 DEMANDS

Advanced manufacturing and EV assembly require automation, AI-driven quality control and secure connectivity, increasing demand for nearby, resilient digital infrastructure.

Sungai Samak Estate Enters the Conversation

Within this landscape, Sungai Samak Estate in Tanjong Malim is gaining attention as a potential data centre site aligned with next-generation requirements. The estate offers five prime land parcels suitable for large-format, campus-style developments.

Compared with southern Johor, Cyberjaya and core Selangor zones, land costs in Sungai Samak Estate remain comparatively disciplined. This allows developers to allocate more capital toward redundancy, sustainability features and future expansion.

Clearer visibility on power availability and less-stressed water resources further strengthen its positioning, improving certainty around development timelines. Additional information is consolidated at https://sgsamak.com.

Industrial Ecosystems and Data Infrastructure Converge

The presence of Proton and BYD highlights a broader trend: data centres no longer operate in isolation. They are becoming integral to advanced industrial ecosystems, supporting real-time analytics, AI modelling and secure data exchange.

Tanjong Malim’s AHTV designation aligns infrastructure planning with national objectives around digitalisation and electrification. Some observers now refer to the area as a technology and infrastructure “goldmine,” a theme explored in https://bit.ly/Tech-Goldmine.

Cost, Sustainability and Long-Term Viability

As Malaysia advances its energy transition and net-zero ambitions, data centre sustainability is no longer optional. Locations with inflated land prices and constrained utilities force difficult trade-offs. Estates like Sungai Samak provide the spatial and economic flexibility to design for long-term resilience.

LONG-TERM DATA CENTRE VIABILITY DEPENDS ON THE ABILITY TO SCALE SUSTAINABLY, NOT JUST TO ENTER QUICKLY

A Multi-Nodal Future for Malaysia

Malaysia’s data centre future is evolving toward a multi-nodal model, where established hubs coexist with emerging regions offering capacity and balance.

Supported by AHTV, anchored by Proton and BYD, and complemented by sites such as Sungai Samak Estate, Tanjong Malim represents a logical extension of Malaysia’s digital infrastructure strategy. Developers can access further details at https://sgsamak.com, with enquiries via https://sgsamak.com/contact-us.

As Malaysia’s digital economy expands, locations combining industrial depth, infrastructure readiness and long-term planning discipline are likely to define the next chapter of growth.

Contact Info:
Name: Holly Lim
Email: Send Email
Organization: Sungai Samak Estate
Address: 2 Jalan Sempurna off Jalan Gombak , Kuala Lumpur, Federal Territory 53000, Malaysia
Website: https://sgsamak.com

Source: NewsNetwork

Release ID: 89181528

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