Microsoft Lands $1.3b Deal in Sydney

Microsoft Lands $1.3b Deal in Sydney

Microsoft aims to build a huge $1.3 billion campus at Kemps Creek, a new industrial estate being developed by Frasers and local fund manager Altis Property Partners in New South Wales. AFR reports that Microsoft is planning for a 190MW facility over 14.4 hectares.

The proposal, along with a six-storey facility that Microsoft is developing at Lane Cove on Sydney’s lower north shore, is part of a global rollout by the US software powerhouse.

According to the NSW government website, the Kemps Creek data centre sites at Mamre Road within Penrith and would include two data storage buildings, 61 generators, a substation on-site, a high voltage switchyard, 30 diesel storage tanks, and an office. The entire site comprises a total area of approximately 17.38 hectares.

The data storage buildings will total around 65,354 sqm; one of the documents reports that design is currently underway for two 48MW centres, with a third data centre being designated as a future build for a total of 144MW capacity.

AFR, in their report, said that The expansion of the data centre sector accelerated markedly in the past year as the use of streaming services and e-commerce surged.

Homegrown operators such as Macquarie-backed AirTrunk and ASX-listed NextDC as well as global players such as Equinix and Digital Realty are building data centres in Australia.  Microsoft currently operates three Australian Azure cloud regions in New South Wales, Victoria, and Canberra; the first two regions opened in 2014, the latter in 2018.

Microsoft’s move to Kemps Creek is a win for Frasers and its partner Altis, which swooped on a 118-hectare site along Mamre Road last year. The site sits within the Mamre Road precinct that is slated to become an industrial and logistics hub.

Frasers Property Industrial owns the most land at Mamre Road across two sites. With Altis, it is already developing a 75,000sq m, $200 million facility for global power tool giant Techtronic Industries.

The Industrial executive general manager of  Frasers property told AFR that Strong sector fundamentals, historically low vacancy and the limited land supply have created a perfect storm, and they expect the take-up of land in the Mamre Road, Kemps Creek precinct to happen a lot quicker than initially forecast.

The documents for the proposal was drawn up by the engineering firm Arup. It outlined plans for a 190-megawatt facility over a 14.4 hectare. Hidden in the details of these documents is Microsoft’s role.

The project is being assessed as a state significant development by the Department of Planning, Industry and Environment. The department’s executive director of energy and resource assessments said in a statement to AFR that the proposal is the latest in a growing trend of rapid planning and development proposals of these in-demand facilities.


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