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Gateway Capital files to build 81MW data center in Sydney, Australia

By: IDCNOVARegion: Oceania
Gateway Capital has submitted a planning application to develop an 81MW data center in Sydney, Australia, marking the investment management firm's first major foray into digital infrastructure. The project, named the Frederick Street Data Centre, is slated for a former industrial site in the St Leonards area, underscoring the growing demand for high-density computing capacity across Australia's eastern seaboard.

According to documents first reported by the North Sydney Sun, Gateway Capital has filed a SEARS application with the New South Wales Government for the development. The site, located on 1.8 hectares at 12 Frederick Street, is earmarked for a five-story facility totaling 16,635 sqm (179,058 sq ft) and offering 81MW of capacity. The building will also include an on-site substation, with plans to house 11 data halls and 44 generators.

Up to AU$1 billion (US$720m) could be invested in the project, reflecting the scale of capital required to bring large-scale data center capacity online. Construction and operation will be carried out jointly by Gateway Capital and Lendlease, Australia's major real estate development firm, according to the filing documents.

The site has a long industrial history, having been part of a brickworks dating back to the 1800s before later serving as a hub for warehouses. The portion designated for the data center currently contains two large multi-story warehouses, indoor recreation and office buildings, and car parking, all of which will be repurposed or cleared for the new facility.

Gateway Capital, an Australian investment management business focused on industrial and logistics assets, manages approximately AU$1.5bn (US$1.08bn) in assets across Victoria, New South Wales, and Queensland. While the firm is not traditionally known for data center developments, it acquired the site in 2023 from Dexus for AU$118.5m (US$85.2m) as part of a joint venture with Invesco's Urban Infill Logistics fund. The industrial estate, comprising 13 warehouse and office units occupying roughly 19,400 sqm (208,820 sq ft), was purchased as a logistics play, but the new filing signals a strategic pivot into digital infrastructure.

Lendlease, which brings significant data center expertise to the partnership, is already developing the Project Blue Tongue data center in Sydney and has partnered with NextDC on a facility in Adelaide. The firm is also building a data center in Tokyo alongside PG Development, positioning itself as a key player in the Asia-Pacific digital infrastructure market.

The proposed development comes as Australia faces a surge in data center demand driven by cloud adoption, artificial intelligence workloads, and increasing digitalization across industries. Industry analysts note that Sydney remains one of the most constrained data center markets in the Asia-Pacific region, with limited land availability and power supply challenges pushing developers to repurpose industrial sites. If approved, the Frederick Street project would add significant capacity to the region, helping to alleviate supply pressures and support the growth of hyperscale and enterprise cloud services.