Gulf Data Hub invests in further expansion in UAE, long-term plans for neighboring markets

Introduction

Over the past decade, the United Arab Emirates, especially Dubai, has shifted its focus from oil and gas to other sectors, one of them being technology. Driven by government efforts to attract businesses from around the world, this growth has led to an increased need for compute and data storage. Gulf Data Hub saw this opportunity and quickly moved to provide wholesale datacenter services. Supported by private investors and strategic partnerships (including with global investment firm KKR & Co. Inc.), it has developed a strong presence, with campuses in Dubai and Abu Dhabi that are being expanded and developed to meet hyperscale demand. With new funding coming in, Gulf Data Hub is set to expand across the broader region, with developments in neighboring countries.

The Take

One key thing that the Gulf Cooperation Council (Saudi Arabia, Qatar, Kuwait, Oman and Bahrain) is missing is a multi-region datacenter provider. To date, only Equinix Inc. and Gulf Data Hub have datacenters in more than one country within the GCC; of those, only Gulf Data Hub is focusing on wholesale datacenter services. With the KKR joint partnership, Gulf Data Hub is signaling that it has its sights set on more. Gulf Data Hub definitely seems well positioned for growth in the UAE's expanding datacenter market, but markets such as Kuwait, Qatar and Bahrain represent more of a risk, as the company intends to do speculative builds ahead of customer demand — often a mandatory move in early-stage markets. This strategy has worked out well in other parts of the world for companies like ST Telemedia and Scala Data Centers, which have built out businesses across Asia-Pacific and Latin America, respectively, but it will not be without challenges.

Context

The UAE has witnessed economic growth away from oil and gas. Various government incentives encouraged local and international business to set up shop; as a result, localized compute and data storage needs grew. Both Etisalat and du started to accommodate local enterprise demand and expanded their datacenter footprint in the country — mainly in Dubai and Abu Dhabi. In addition to this, sovereign investment firm Mubadala started investing in the information and communications technology sector, and as a result the market saw Khazna Data Centers enter the playing field with wholesale datacenters and du branch out to create datacenter-focused subsidiary datamena.

Gulf Data Hub was established in 2012 in Dubai, UAE, by CEO Tarek Al Ashram. The creation of Gulf Data Hub, which focuses primarily on wholesale, was funded by a combination of private investments, as well as partnerships with technology and telecom companies in the UAE that were looking to move off-premises with leased datacenter space. Gulf Data Hub also received debt financing from local banking institutions.

In January 2025, Gulf Data Hub signed a partnership agreement with global investment firm KKR, whereby both parties have committed to invest over $5 billion in further developing Gulf Data Hub's footprint in the UAE and across the GCC markets. The investment will be made through KKR's Global Infrastructure strategy team and is pending customary regulatory approval.

UAE Market

Covering 6.5 square kilometers, Dubai Silicon Oasis is 20 km south of Dubai International Airport and is operated by the Dubai Silicon Oasis Authority government agency. It was established as an environment for the global semiconductor industry. Gulf Data Hub has its datacenter campus here and says it chose the location for easy access to the city center and high power availability. Gulf Data Hub has been operating two datacenters in the Dubai Silicon Oasis free zone since 2014. Dubai 1 and Dubai 2 offer 32,000 square feet of technical space each. Dubai 1 offers 4.2 MW of IT capacity and Dubai 2 offers 6 MW. The datacenters have been designed to support high-density equipment with up to 30 kW per rack. Gulf Data Hub leased all the capacity at its Dubai 1 and Dubai 2 datacenters to Etisalat in 2017, as part of a 15-year wholesale deal. Gulf Data Hub's campus has since expanded to include two more facilities, Dubai 3 and Dubai 4. Both facilities have been fully leased on a wholesale basis to one customer (not Etisalat). Dubai 3 and Dubai 4 offer 53,800 square feet of white space each, and came into operation in 2021 and 2023, respectively. Dubai 3 offers 12 MW of IT capacity, and Dubai 4 offers 16 MW. Gulf Data Hub's fifth datacenter is under construction within the same campus, and has already been fully preleased to the same customer that is leasing Dubai 3 and 4. The facility is set to become operational in Q1 2026. Gulf Data Hub has a plot of land that it intends to develop on within its campus in 2027.

Gulf Data Hub also has developed facilities in Abu Dhabi, one operational campus based in ICAD (Industrial City of Abu Dhabi) and another under construction in KIZAD (Khalifa Industrial Zone Abu Dhabi). In its ICAD campus, Abu Dhabi 1 came online in 2022 with 16 MW of IT capacity and is fully leased to one customer; Abu Dhabi 2 came online in 2023 with an additional 16 MW of IT capacity, preleased to the same customer in Abu Dhabi 1. Gulf Data Hub is further expanding in Abu Dhabi with its KIZAD campus, where one facility offering 22 MW is under construction, and plans for four more facilities within the same campus are being investigated for future growth.

Developments outside of the UAE

Outside of its home market, Gulf Data Hub's recent funding in partnership with KKR is aimed at developing its footprint across neighboring markets. In Saudi Arabia, the provider has 22 MW of IT capacity under construction in Riyadh, and is expanding its Dammam facility from 6 MW to 12 MW. All new construction is being built out speculatively, with Gulf Data Hub putting forward a strategy of being at the forefront of the predicted growth in demand with its supply. In Qatar, Kuwait and Bahrain, Gulf Data Hub has acquired land and power for buildouts, but no construction has started yet. Gulf Data Hub plans on beginning construction in Kuwait and Qatar by the end of 2026, and in Bahrain by the end of 2027. Gulf Data Hub has stated that any customer looking to lease 1 MW and up from large enterprises and government entities would be of interest for these new speculative facilities, but its main area of focus is the various hyperscalers.

Competition

Khazna Data Centers is the only other provider in the UAE that focuses on wholesale supply. Khazna Data Centers was established in 2012 with funding from sovereign investment firm Mubadala, which held a majority stake in the company and the land Khazna built on. Khazna has built three wholesale datacenters in the UAE; its flagship facility is in Meydan, Dubai. Equinix leases space in Khazna's datacenters in Dubai and Abu Dhabi. In 2020, Mubadala acquired a minority stake in G42 Group, an Abu Dhabi-based AI and cloud computing company, and in doing so acquired Khazna and Injazat. In October 2021, G42 group signed an agreement with E& to merge their datacenter offerings in the UAE, and in doing so Khazna acquired all of E&'s datacenters in the region. The agreement increased Khazna's footprint to 12 datacenters. Khazna says it operates 24 facilities in the UAE, with an operating capacity of 160 MW. The wholesale provider is expanding up to 300 MW within the next 18 months, across some 30 facilities total, with eight under construction and four more planned.

SWOT Analysis

^{Source: 451 Research.}