UAE property tycoon Sajwani makes $1 billion bet on data centers
DUBAI, United Arab Emirates — Emirati property magnate Hussain Sajwani will invest $1 billion to build a global network of data centers under his recently launched Edgnex venture, marking a pivot to digital after two decades in brick and mortar real estate.
“We’re going to build data centers in Europe, Asia, Africa and the Middle East,” Sajwani told CNBC on Wednesday. “We want to build a global company, and we’re allocating a billion dollars for that business, and we’re going global to put our footprint in all those four continents,” he added.
Sajwani, who founded Damac Properties in the early 2000s and made a fortune building apartments, hotels and golf courses in and around Dubai, said data centers were a natural progression for his business as the pandemic accelerates a shift to digital work and play.
“We have the cash to inject, we’ve hired a very good team… and we think we can build them at a more reasonable cost than our competitors,” Sajwani said. Edgnex, the new wholly owned data center venture of which he is founder and chairman, has already earmarked five plots to develop data centers, including three in Saudi Arabia, two in Turkey and one in Ireland.
It comes as demand for data center infrastructure has grown through the pandemic, attracting interest from traditional commercial real estate developers and investors as a way to diversify their interests. Recent years have seen major tech firms expand into the Middle East in the data center and cloud computing space as commerce and investment in the region grows.
Cloud computing giant Amazon Web Services (AWS) is set to expand into the UAE, opening an “infrastructure region” in the country in the first half of 2022 after its first foray into the Gulf, an AWS availability zone in Bahrain. In 2019, Microsoft launched its first Middle East data centers in Abu Dhabi and Dubai.
“We’re not going to build the racks, we’re leasing the space,” Sajwani said. Edgnex will target “hyperscalers” such as Google, Amazon and Microsoft to lease its facilities for use in emerging or underserved markets around the world.
“The next step is co-location. If we build 20 megawatts, a “hyperscaler” can take 15, and the other five we can lease to banks and large institutions,” he said. Edgnex also plans to roll out smaller edge data centers in the coming years, targeting a market expected to be worth $13.5 billion by 2024, according to a recent study by PWC.