As the digital economy accelerates, Australia’s data centre sector is entering a transformative phase - one defined by mega-campus development, global capital influx, and a new wave of technological and geographical diversification.

JLL’s dedicated Data Centre team, comprising specialists across capital markets, land and leasing, and technical infrastructure, expect 2026 to be a year of consolidation, scale and strategic partnerships.

According to Luke Jackson, Co-Head of Data Centres, Capital Markets Asia Pacific, data centre deals will begin to shift and become more sophisticated. “We’ve entered a new phase where takeout capital becomes the dominant story,” he explains. “Over the past few years, capital has been piling into development or platform M&A. Now, those investors will look to exit, and we’ll see more standing asset transactions as a result.”

As the market matures, so too does its financing structure. Private credit and debt funds are expanding into the space, providing critical funding for projects at both the land and construction stages.

“We’re already seeing this play out,” Jackson adds. “It signals how diversified and globalised capital structures in this sector have become.”

Joint ventures at the asset level are also becoming more common as operators seek capital partners to advance their pipelines. The outcome? A shift from speculative builds to stabilised, income-producing investments.

Phoebe Cooney, Senior Analyst, Data Centre Capital Markets Asia Pacific, says this shift has introduced new layers of complexity when it comes to assessing returns.

“There’s far more nuance in how investors are evaluating yield and risk,” she explains. “Traditional REITs and private groups are looking to play in the space, but the capital stack and operational profile are unlike any other asset class.”

Cooney notes that the evolving investor mix reflects a wider recognition of data centres as essential, infrastructure-grade assets - and an increasing need for partners who understand both property and power.

On the ground, Thomas Madigan, Head of Data Centres Capital Markets Australia, is seeing a clear evolution in where - and how - operators are expanding.

“We’re seeing demand expand to areas outside traditional Availability Zones in Sydney and Melbourne,” he says. “Developers and operators are reviewing regional areas in New South Wales and Victoria and emerging areas like Perth and parts of Queensland, where power availability, limited competition and speed to market are major advantages.”

Madigan predicts 2026 will see a surge in large-scale campuses outside existing availability zones.

“The next generation of facilities will be bigger, more power-efficient, and increasingly located where the grid can support long-term growth.”

Alex Micallef, Project Director, says the market is rapidly progressing toward mega-campus development and AI-dedicated builds.

“We’re starting to see a rationalisation of strategies,” he explains. “Hybrid solutions are evolving into dedicated AI campuses, with some planned to exceed 500 megawatts. The big players will continue to scale - and that will leave opportunities for smaller, specialised operators.”

Technologically, cooling innovation is at the forefront.

“There’s a battle between direct-to-chip and immersion cooling,” Micallef adds. “Liquid-to-chip is becoming standard, but we’re still seeing immersion cooling take up a reasonable share of the market.

With the increasing size of data centre developments we are also seeing increased focus on integrating on-site power generation and virtual power plant participation. It’s about resilience - producing power up to a certain point and reducing strain on the grid.”

Meanwhile, Matt Lee, National Director, Data Centre Occupier Services, highlights the explosive rise of the neocloud segment - next-generation cloud providers designed for AI and large-scale compute.

“Groups like Firmus and SharonAI are rewriting the rules,” he explains. “They’re supported by heavyweights such as NVIDIA, which is effectively creating its own customer ecosystem. When you combine that with the power and land constraints we are seeing globally and the local market transparency, Australia becomes a natural beneficiary.”

Lee expects global AI demand to continue to flow into Australia as long as power, water and land can be effectively sourced.

“The fundamentals are here: available land, political stability and power security. That combination will attract the next wave of global data demand.”

With maturing capital, new entrants and transformative technology, Australia’s data centre market is entering its most sophisticated stage yet. JLL’s multi-disciplinary Data Centre team - spanning investment, leasing and technical infrastructure - is uniquely positioned to guide clients through this evolution.

“The narrative for 2026 is maturity and momentum,” says Lee. “Data centres have shifted from a niche to an institutional-grade asset class - and Australia is firmly on the global stage to capitalise on this growth.”