How expensive is it to build a data centre in Tokyo?

Tokyo's construction cost is $18.28 per watt, the highest of the 62 markets in the index and the top ranking for a fourth consecutive year.

What is the biggest obstacle to data centre projects?

56% of respondents cited power as a major obstacle, and 52% said grid connections typically take one to two years.

Which markets are cheapest for data centre construction?

Shanghai was lowest at $5.79 per watt, followed by Mumbai at $6.83 and Ho Chi Minh City at $8.32.

AI Business & IndustryPR TIMES (AI)1d agoOct 29, 2026, 22:01 JST

Tokyo tops data centre costs again at $18.28 per watt

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3 Key Points

What happened
Turner & Townsend's 10th Data Centre Cost Index put Tokyo first for a fourth year at $18.28 per watt, with Osaka second at $17.15 and Singapore in the top five.
Why it matters
Japan's high build costs reflect strong demand from domestic AI and tech firms, and the survey shows cost and skilled-labour pressure shaping where projects can go.

WHO IT HITSCompanies planning AI data centre builds in Japan and Asia face some of the world's highest construction costs, while developers and contractors must budget for scarce skilled labour and power connections.

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Context & Analysis

The index's 10th edition arrives as AI demand reshapes data centre construction. Turner & Townsend's Paul Barry said capital spending on data centres now reaches $800 billion a year, with a forecast of $1.8 trillion by 2050, citing PwC's Global AI Infrastructure Report. That scale helps explain why costs stay structurally high even as 2026 showed some easing of pressure.

The survey paints a market where location choice is increasingly a cost and risk decision. Tokyo and Osaka lead on cost, but Asian markets also include some of the cheapest build locations, such as Shanghai and Mumbai. Across markets, respondents reported shortages of skilled labour and long power connection waits, and 52% expect most 2027 projects to support AI workloads.

FAQ

How expensive is it to build a data centre in Tokyo?: Tokyo's construction cost is $18.28 per watt, the highest of the 62 markets in the index and the top ranking for a fourth consecutive year.
What is the biggest obstacle to data centre projects?: 56% of respondents cited power as a major obstacle, and 52% said grid connections typically take one to two years.
Which markets are cheapest for data centre construction?: Shanghai was lowest at $5.79 per watt, followed by Mumbai at $6.83 and Ho Chi Minh City at $8.32.

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