Vietnam eyes data center investment boom as capacity ramps up

Total operating capacity in Hanoi and Ho Chi Minh City stood at about 60 megawatts in 2025, well below regional peers such as Jakarta, Kuala Lumpur, and Bangkok, highlighting significant room for growth, JLL said.

The market is currently led by domestic operators including VNPT, Viettel IDC, FPT Telecom, and CMC Telecom, with demand rising from sectors such as finance, e-commerce, online gaming, and digital content.

Large-scale projects are beginning to emerge, including a 140-megawatt facility by Viettel IDC in Ho Chi Minh City and a planned nearly US$2 billion project with expected capacity of about 200 megawatts backed by Kinh Bac City Development Holding Corporation.

CMC Corporation is also investing more than $250 million in a hyperscale data center project with planned capacity of up to 120 megawatts.

JLL said Vietnam is likely to follow regional growth trends as Southeast Asia data center capacity expands rapidly, driven by increasing cloud adoption and AI-related demand.

The consultancy said attracting large-scale investment will depend on improvements in power supply, land availability, and international connectivity.

Vietnam’s power development plan targets total generation capacity of about 155 gigawatts and includes mechanisms for direct power purchase agreements, which are seen as important for ensuring stable and renewable energy supply for data centers.

Facilities are typically located in industrial zones or high-tech parks near major cities, where land costs can be 30 percent to 50 percent higher than standard industrial land due to infrastructure requirements.

Connectivity is also a key factor, with existing submarine cables and planned new routes expected to play a role in reducing latency and supporting cross-border data flows.

Vietnam has moved to allow full foreign ownership in data center and cloud services, although implementation factors such as power connections, equipment imports, and workforce development are expected to influence the pace of expansion.

JLL said data center clusters are likely to emerge first around Ho Chi Minh City and nearby Dong Nai Province, and around Hanoi, before expanding to surrounding areas.