Data Center Investment Boom: Is There Opportunity in Gyeongbuk Too?

Data centers are currently the hottest sector in the global real estate market. According to CBRE, North American data center vacancy rates have fallen to historic lows of 1.6%, and 74.3% of capacity under construction is already pre-leased to cloud and AI companies. Cushman & Wakefield announced that Seoul ranks first in comprehensive scores among emerging data center markets.

Korea's market growth is also remarkable. According to Savills Korea reports, domestic data center total power capacity is projected to grow from 1.9GW in 2024 to 4.8GW in 2028. The compound annual growth rate (CAGR) is 26.4%. The proportion of financial investors is also expected to expand from 23% in 2024 to 63% in 2028.

Currently, over 80% of Korea's data centers are concentrated in the metropolitan area. However, limitations to metropolitan expansion are emerging due to power shortages, rising site prices, and cooling water securing problems. The trend highlighted by CBRE that 'power supply speed has become more important than location' is a factor promoting regional dispersion.

Gyeongbuk has potential for data center attraction. Stable and affordable power supply is possible due to proximity to KHNP nuclear plants, and fiber optic backbone infrastructure of Gyeongbu and Donghae expressways passes through. Land costs are 30-50% of metropolitan levels. However, network latency is a key variable, but regional locations are sufficiently competitive for uses where real-time performance is less critical, like AI training and inference workloads.

In fact, cases of building large-scale data centers in regional areas like Hokkaido and Kyushu in Japan are increasing. Korea is also supporting regional data center attraction as part of the 'Digital New Deal' policy, and Gyeongbuk Province is also actively pursuing digital infrastructure investment attraction.

The economic impact of data centers on regions is considerable. One 1MW data center creates 200-300 jobs during construction and 30-50 jobs during operation. For Gyeongbuk to enter this market, stable power supply infrastructure, high-speed network connectivity, and rapid permit support are three essential conditions.