When data centre developers plan a build, headaches usually come in four flavours – water, fibre, land and power.
And as a country whose urban areas contain so much of its people and economic base, developers in Japan often have a tough time with the final two factors, especially in the capital Tokyo. With AI demand booming in Tokyo and the rest of Japan just like it is in other advanced economies, space and power must be found somewhere.
For Princeton Digital Group, the answer was to go to the capital’s northwestern fringes. The company opened its 96 MW TY1 facility in the district of Saitama City, 35km from the centre of Tokyo, in late April 2025 – it’s one of Japan’s largest facilities, and it’s July’s Data Centre of the Month.
Built with AI front of mind, TY1’s technical specifications are as future-proofed as realistically possible. The facility delivers 96 MW of air-cooled IT capacity across 59,000 square metres, with power per rack averaging a substantial 140kW.
In terms of power usage and efficiency, the main constraint for Japanese data centres, TY1’s design PUE of <1.34 makes it a shade more efficient than the global average PUE for facilities over 30 MW. This is particularly impressive given that Japan’s roasting hot summers make it difficult for the country’s operators to restrain power usage (the country’s average currently stands at around 1.6).
This power is supplied by a 66kV feed via the city’s grid. This is backed up with a distributed redundant UPS system with up to 10 minutes battery autonomy, which is sufficient in a country that only suffered 22 minutes of grid outage across its data centres in the whole of 2022. In terms of fibre, TY1 is carrier-neutral, benefiting from proximity to the Minamiboso landing point near Chiba, where the trans-Pacific JUNO and Apricot cables are both planned to operate by 2027.
On the construction side, TY1 was the first project built by the Lendlease Data Centre Partners fund, a dedicated arm of the construction company for data centre projects. Various sustainability measures, including storing rainwater for gardens and toilets and using only native plants for landscaping, are part of the facility’s application for LEED Gold, C&S and LEED CI certification.
TY1’s launch comes at a pivotal time for digital infrastructure development in Japan. In the words of Rangu Salgame, Chairman, Chief Executive Officer, and Co-Founder of PDG who spoke at the facility’s opening, “AI has reshaped the data centre landscape”. While this is true globally, it applies especially in Japan, where there are strong fundamentals for AI to take off.
Already the third-largest data centre market in the world after the US and China, Japan has a mature industrial base that is receptive to technology, as well as numerous government digital transformation initiatives and a highly urbanised population well used to receiving services digitally.
As the country’s economic centre, Tokyo will account for a lot of this growth – together with Osaka, the city accounts for 98% of Internet traffic. But as with all mature markets, there are bumps in the road.
Land availability, particularly in eastern Tokyo, has stymied data centre buildout, explaining a close to 95% occupancy rate for the greater Tokyo region. The city’s grid is also struggling to meet data centre-driven demand like in many other markets (however, one usual reason for grid overstretching – EV charging – is less of an issue in Japan due to carmakers and motorists preferring self-charging hybrids).
These constraints meant that when looking for a place to put their hyperscale-targeted facility, PDG looked at Saitama City in the north-west of the capital. Despite its copious spare land, a decent fibre mesh, available power, and close connections south to the various subsea landing points serving the capital, Saitama is an underused area of the Japanese capital for data centres. But as the emergence of various ‘sub-hubs’ in existing data centre hotspots shows (developments in Virginia outside of Loudoun County are a good example), there is a precedent for multiple operators being attracted to new areas of existing locations.
What next for the Japanese AI data centre market? The consensus is substantial growth. Research suggests AI-related demand will account for three quarters of total data centre capacity in Japan by the end of the decade (the figure already stands at 57%, so this is by no means an outlandish prediction), meaning new facilities will be needed to service the demand – and they are coming thick and fast.
This means even more of a challenge to secure power, water, land and fibre. TY1 showing the benefits of careful location selection to do so – and it could spark the emergence of a new mini-hub within the Tokyo area.
