With businesses and consumers generating more data than ever before, from working online to streaming and using generative AI like ChatGPT, countries in the region are building the infrastructure needed to keep up with increasing demand. But this growth poses a problem. Opinions expressed are those of the author. Raed Rached, Expereo, Managing Director MEA. Data centers are among the. Knight Frank Data Centres are a globally recognised data centre consultancy business that provide market leading advice to owners, occupiers, and investors in the data centre industry. The Middle East is rapidly becoming a data centre. Investment in data centres in the Middle East is expected to slow in 2026, as the region's recent spending spree is expected to give way to more sustainable and long-term growth, industry experts have told AGBI. Initiatives such as New Kuwait 2035 and Digital Oman 2030 are also contributing.
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While traditional data centres generate revenue from predictable (often pre-committed) enterprise and cloud storage contracts, AI-focused centres rely on demand ramp up from hyperscalers, AI research institutions, and enterprises deploying large-scale AI models that require training ahead of deployment.
Power availability and consumption are critical issues, particularly for AI-focused data centres that require up to 10 times more power than traditional facilities. To address renewable power needs at this scale, governments are adapting to an integrated approach, synchronising planning for power and data centre projects.
Large data centers currently constitute about 59% of the Tier 3 segment, with major operators like Khazna Data Center holding a market share of nearly 20%, followed by Etihad Etisalat Company and Etisalat with market shares of 19% and 9% respectively.
Further, a data center with a PUE of 1.2-1.5 is considered highly efficient, whereas, a data center with a PUE >2 is considered highly inefficient. It is defined as a system design wherein additional component (UPS, generators, CRAC) is added so that in case of power outage, equipment failure, the IT equipment should not be affected.