SKS Technologies has landed a $28 million early works contract for the MEL2 hyperscale data centre in Melbourne, boosting its FY27 order book to $312 million amid a surging Australian data centre pipeline.
- $28 million early works contract for MEL2 data centre
- Order book grows to $312 million for FY27
- Data centre pipeline exceeds $1 billion in tenders
- Melbourne MEL2 site planned for 354MW capacity
- Australian data centre capacity forecast to more than double by 2030
SKS Advances Melbourne Hyperscale Data Centre Pipeline
SKS Technologies Group (ASX:SKS) has won a $28 million contract to deliver early works on the MEL2 hyperscale data centre in Melbourne’s northwest, marking a significant follow-up to the $120 million of electrical systems it completed for the MEL1 facility in 2024. The MEL2 project is part of a larger development expected to deliver over 354MW of capacity backed by more than $5 billion of investment.
Chief Executive Matthew Jinks highlighted the MEL1 project as a launch pad for securing repeat work and larger contracts, positioning SKS as an established player in Australia’s hyperscale data centre market. The company’s early works scope includes substation infrastructure, gas insulated switchgear fit-out, and installation of high and low voltage conduits and communications infrastructure, enabling subsequent structural construction.
Order Book Growth Reflects Data Centre Boom
This latest contract lifts SKS’s FY27 starting order book to $312 million, representing a sevenfold increase since June 2023. The company’s tender pipeline has surged to over $1.25 billion, with data centre projects alone accounting for just over $1 billion. This follows a near doubling of the tender pipeline since February 2026, underscoring sustained momentum in the sector.
Industry forecasts underpinning SKS’s optimism anticipate Australian data centre capacity expanding from 1.4GW in 2025 to 3.2GW by 2030, a 128.6% increase. Melbourne and Sydney remain hotspots, with SKS noting 44 projects totalling 11.4GW in Sydney and 30 projects totalling 9GW in Melbourne in the pipeline.
Strategic Positioning Amid Sector Expansion
SKS’s deepening involvement in hyperscale data centre infrastructure aligns with broader trends of escalating demand for digital infrastructure in Australia. The company’s ability to secure early works contracts like MEL2 is critical, as these foundational stages set the tone for larger, more lucrative construction phases. Immediate commencement of works signals SKS’s readiness to capitalize on this growth.
While the contract value and order book expansion are clear positives, investors will be keen to monitor execution timelines and margin outcomes as the MEL2 project progresses. The broader data centre sector’s rapid expansion offers opportunities but also demands operational precision amid intense competition.
Bottom Line?
SKS’s $28 million MEL2 early works contract cements its foothold in Australia’s booming data centre sector, setting the stage for further growth in a rapidly expanding market.
Questions in the middle?
- How will SKS manage execution risks on the large-scale MEL2 project?
- What margin profile can SKS sustain as its data centre order book multiplies?
- Will SKS expand further into Sydney’s hyperscale data centre developments?