Dublin, May 02, 2024 (GLOBE NEWSWIRE) -- The "Latin America Data Center Construction Market - Industry Outlook & Forecast 2024-2029" report has been added to ResearchAndMarkets.com's offering.
The Latin America Data Center Construction Market was valued at USD 1.36 billion in 2023, and is projected to reach USD 2.32 billion by 2029, showcasing a CAGR of 9.25%.
The data centers in Latin America are increasingly adopting advanced techniques such as air and liquid-based cooling. This includes innovations such as liquid-based immersion cooling and the incorporation of inventive air conditioning technology by Google in its latest data center in Uruguay.
Eaton, Caterpillar, Cummins, Legrand, ABB, Rolls Royce, and Schneider Electric are some of the significant electrical infrastructure providers in the Latin America data center construction market that are collaborating with operators for installing electrical infrastructure, such as UPS systems and generators, with a minimum of N+1 redundancy. For instance, the KIO Networks BOG 1 data center facility is installed with Cummins diesel generators.
Data centers are investing in cooling infrastructure due to the high-temperature climate in some Latin American countries. In 2023, cooling systems accounted for a market share of more than 65% of the total mechanical infrastructure in data centers.
Key Market Dynamics
Market Opportunities & Trends
- Edge Data Center Deployments Fueled by 5G Launch
- Growth in the Procurement of Renewable Energy
- Deployment of Artificial Intelligence (AI) Workloads in Data Centers
- Growth in the Deployment of Submarine Cables
Market Growth Enablers
- Increase in Demand for Cloud-based Data Centers
- Big Data & IoT Boosting Data Center Investments
- Implementation of Tax Incentives Appeals to Data Center Investments
- Growth in Digital Economy
Market Restraints
- Location Constraints
- Dearth of Skilled Workforce
- Increase in Carbon Emissions from Data Centers
- Data Center Security Challenges
KEY TRENDS
Surge of 5G Connectivity in Edge Data Center Investments
- In Latin America, 5G will account for nearly 60% of the total mobile connections by 2030. The deployment of 5G networks is fueling modern edge devices, remote working, and the application of advanced technologies. Brazil is leading the way in 5G technology deployments. Other countries, including Mexico, Argentina, Colombia, and Peru, are in the trial stage.
- In December 2023, Colombia's Ministry of Information Technologies and Communications (MinTIC) authorized Claro, Partners Telecom Colombia (WOM), Union Temporal Colombia Movil-Telefonica, and Sociedad Futura Telecall Colombia to participate in the 5G auction, which is expected to generate around USD 500 million.
- The rising deployment of 5G services and the growth in demand for connectivity in new locations and Tier I and II cities are attracting investments from edge data center operators. For instance, edge operators, including Surfix Data Center, Brisanet, V.tal, and EdgeUno, are investing in establishing multiple edge data centers across Brazil, Chile, Colombia, and Mexico.
Increase In Sustainable Initiatives
Latin American governments, such as Brazil, Chile, Mexico, and Colombia, have set sustainability targets. They are working together to diversify their electrical networks to support the policy and regulatory changes that encourage using renewable energy sources. Brazil, Chile, and Mexico have tremendous influence among neighboring countries, allowing them to present their renewable energy policies as viable models for the other countries in the region.
Digital Economy
Governments and organizations are taking initiatives to develop and grow the digital economy. These initiatives are slated to increase the region's digital transactions and smart payment technologies. According to the World Bank, around 75% of the Latin American population has internet connectivity, and 35% of individuals still prefer cash to digital payment methods.
In January 2024, Amazon customers in Mexico could choose Kueski Pay, a Buy Now Pay Later (BNPL) option. This provides the purchase plans of 12 bi-weekly installments through linked bank accounts, debit cards, or cash under respective networks.
GEOGRAPHICAL ANALYSIS
- Brazil led the Latin America data center construction market in 2023, accounting for over 40% of the market share in investments. Mexico, Chile, and Colombia followed this country.
- In Latin America, several countries are actively establishing Special Economic Zones (SEZs), Free Trade Zones (FTZs), Export Processing Zones (EPZs), business parks, and industrial zones, which provide attractive benefits such as tax incentives for international businesses. In 2023, Google started the construction of the Teros data center facility in Uruguay. The company acquired a property of around 30 hectares within the Parque de las Ciencias Free Trade Zone (FTZ) in the Canelones department of Uruguay.
VENDOR LANDSCAPE
- AECOM, Aceco TI, Afonso Franca Engenharia, Fluor Corporation, Jacobs Engineering, Constructora Sudamericana, Quark, Zeittec, Modular Data Centers, Soben, KMD Architects, Syska Hennessey Group, Quark, Gensler, Turner Construction, and ZFB Group are some of the key players in Latin America data center construction market.
- For instance, Afonso Franca Engenharia is involved in the ODATA RJ1 data center phase expansion in Rio de Janeiro as well as the development of the CloudHQ data center campus in Paulinia and the V.tal data centers in Fortaleza and Porto Alegre.
Key Data Center Support Infrastructure Providers
- ABB
- Alfa Laval
- Assa Abloy
- Axis Communications
- Bosch Security Systems (Robert Bosch)
- Caterpillar
- Cummins
- Daikin Applied
- Delta Electronics
- EATON
- Honeywell
- Johnson Controls
- Legrand
- Munters
- Mitsubishi Electric
- Piller Power Systems
- Panduit
- Rittal
- Rolls-Royce
- Schneider Electric
- Siemens
- STULZ
- Vertiv
Prominent Construction Contractors
- AECOM
- Aceco TI
- Afonso Franca Engenharia
- Constructora Sudamericana
- Cundall
- Fluor Corporation
- Gensler
- HDOS
- Hyphen
- Holder Construction
- Jacobs Engineering
- KMD Architects
- Modular Data Centers
- PQC
- Quark
- Syska Hennessey Group
- Soben
- Turner Construction
- Turner & Townsend
- The Weitz Company
- ZFB Group
- Zeittec
Prominent Data Center Investors
- Amazon Web Services (AWS)
- Ascenty
- Angola Cables
- Ava Telecom
- Blue NAP Americas
- Cirion Technologies
- ClaroVTR
- Digicel
- Entel
- Equinix
- EdgeUno
- EdgeConneX
- Elea Digital
- Gtd Peru
- HostDime
- IPXON Networks
- InterNexa
- KIO Networks
- Microsoft
- Millicom (Tigo Panama)
- Nabiax
- Oxygen
- Onex
- ODATA (Aligned Data Centers)
- Quantico
- Scala Data Centers
- SONDA
- Telecom Italia Sparkle
- V.tal
New Entrants
- CloudHQ
- DHAmericas
- EVEO
- Layer 9 Data Centers
- Surfix Data Center
Key Attributes:
| Report Attribute | Details |
| No. of Pages | 354 |
| Forecast Period | 2023 - 2029 |
| Estimated Market Value (USD) in 2023 | $1364.5 Million |
| Forecasted Market Value (USD) by 2029 | $2320 Million |
| Compound Annual Growth Rate | 9.2% |
| Regions Covered | Latin America |
Market Segmentation
Infrastructure
- Electrical Infrastructure
- Mechanical Infrastructure
- General Construction
Electrical Infrastructure
- UPS Systems
- Generators
- Transfer Switches & Switchgear
- PDUs
- Other Electrical Infrastructure
Mechanical Infrastructure
- Cooling Systems
- Racks
- Other Mechanical Infrastructure
Cooling Systems
- CRAC & CRAH Units
- Chillers Units
- Cooling Towers, Condensers, and Dry Coolers
- Economizers & Evaporative Coolers
- Other Cooling Units
Cooling Technique
- Air-based Cooling
- Liquid-based Cooling
General Construction
- Core & Shell Development
- Installation & Commissioning Services
- Engineering & Building Design
- Fire Detection & Suppression
- Physical Security
- DCIM/BMS Solutions
Tier Standard
- Tier I & Tier II
- Tier III
- Tier IV
For more information about this report visit https://www.researchandmarkets.com/r/1shdg
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