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Data center update Sao Paulo

Dennys Andrade • 10/30/2023

As the primary data center hub for Brazil, São Paulo has seen rising interest from regional operators as well as international hyperscalers and colocation providers.

With a massive population (almost 20% that have yet to have internet access) and a limited number of data centers, the market makes a logical entryway into South America. Across two cable landing stations, the market has access to ten major undersea cable routes. The market itself is fairly fiber dense, with telecommunications companies having established metro and longhaul routes through the market.

In terms of colocation in the market, Ascenty, Equinix and ODATA have a significant footprint. Many operators are partnerships between multiple entities: Ascenty is a joint venture between Digital Realty and Brookfield, Scala Data Centers is funded by DigitalBridge and ODATA was acquired by Aligned Data Centers in May of this year As for hyperscalers, Microsoft announced self-perform projects in the Campinas and Hortolândia submarkets of São Paulo – its first in Latin America. AWS, Google, Huawei, Tencent and Oracle also have a cloud region footprint in the market.

As of June, Ascenty has purchased an additional 500,000 sf of land in Osasco. The operator recently sourced $1B in financing from Natixis, Scotiabank, Credit Agricole, Banco MUFG Brasil, and Mizuho. Other entrants are increasingly establishing larger footprints, with CloudHQ announcing a 144MW three-building campus in Campinas. Ada Infrastructure, a vehicle of Singapore-based GLP, has also proposed 40MW for Campinas along with another 60MW in nearby Rio de Janeiro.

While hydropower has been a primary source of power in Brazil, recent data center developments have signed PPAs for wind power (Microsoft signing an agreement for 154MW, ODATA has bought a minority stake in a 212MW wind farm). The market will continue to see some of the largest data center development plays in the coming years.


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