Tier Two Metro Markets are Reshaping the Colocation World

RENO, NV, August 7, 2025

New data from Synergy shows that just ten metros account for 41% of the world’s current colocation market. Northern Virginia is the single biggest market, accounting for 7% of the total. It is followed by Beijing, Shanghai and London, each accounting for around 5% of the total, and then Tokyo and New York at around 4% each. Despite the dominance of these ten metros, it is the next tier of metros that is increasingly reshaping the colocation market. While the top ten markets grew on average by 8% in the last year, the next thirty grew by an average of 12% and the following thirty by 17%. Those sixty metros now account for 39% of the worldwide market. Among the metros ranked 11-40, the markets that are growing the most rapidly are Johor, Johannesburg, Kuala Lumpur, Portland, Jakarta and Mumbai. Among the metros ranked 41-70 the growth leaders are Austin, Lagos, Quincy, San Antonio. Warsaw and Dubai. While metros in the APAC and EMEA regions feature heavily among the growth leaders, it is notable that some tier two US markets also make the list. The research is based on Synergy's in-depth quarterly tracking of colocation markets, including both retail and wholesale segments. Synergy provides quarterly revenue data for over 300 colocation companies, with breakouts for 59 countries and 91 individual metro markets. There is a strong local and national aspect to colocation, but on a worldwide basis the leading companies are Equinix, Digital Realty, NTT, China Telecom, CyrusOne, GDS, KDDI and Chindata.

"Proximity to customers remains a key driver of the colocation market, so data centers tend to be located in metros that have a large concentration of companies and economic activity. Consequently, the markets in the top 10 have not changed since Synergy published a similar analysis a year ago, though there has been some movement in the ranking, with Shanghai having leapfrogged London,” said John Dinsdale, a Chief Analyst at Synergy Research Group. “What is more interesting is the much higher growth rate of many emerging markets. While the top ten have grown by an average 8%, no less than 17 tier two metros have grown by 20% or more. This is a clear indication of how the market will evolve over the coming years with rapidly developing markets becoming ever more important.”