Energy and carbon have traditionally dominated real estate sustainability discussions. This makes sense given their contributions to net operating income and long-term asset value. However, there is increasing recognition that water use is emerging as a material risk and opportunity for real asset investors.
Access to water is important for almost every real asset, but concerns are most acute for resource-intensive data centres. Investors are well-aware of implications of data centres for energy and emissions. According to the International Energy Agency (IEA), Southeast Asian data centre electricity demand is expected to more than double by 2030 compared with 2024. It has been less obvious that this growth will be accompanied by financially material water resource considerations.
Data centre water use is complex. Data centres may use, reuse or indirectly consume water in many ways. Impacts vary by cooling technology, water source, local conditions and electricity gene
