The business will be run by Graha Teknologi Nusantara, a joint venture between Lippo subsidiary Multipolar Technology, which has a 65% stake, and Japan's Mitsui & Co. and subsidiary Mitsui Knowledge Industry, which holds respective stakes of 10% and 25%. Graha Teknologi will initially spend $25 million to $30 million on a two-story facility with 1,000 server racks. It is expected begin operation by April 2016.

Eventually the company plans to put up three buildings with a total floor space of about 40,000 sq. meters and 20,000 racks, which would make it one of the largest data centers in the world.

Local telecommunication companies such as Telekomunikasi Indonesia already operate data centers in the country, but Lippo says it has higher security standards than its competitors, including a monitoring system from Secom, a Japanese security company. It also offers lower prices by using 20% less electricity than conventional facilities.

The data center will be built in the Cikarang district, about 30km east of Jakarta, where many industrial parks are being developed. Jakarta-based financial institutions can also use the data center as a disaster-recovery facility. At the moment, companies with safety concerns use data centers in Singapore, where the market is more developed.

The data center will be a part of Orange County, a 322 hectare satellite city being developed by Lippo's property unit, which hopes to create a hub for local and foreign companies as Jakarta becomes increasingly congested.

The move is the latest effort by Lippo and Mitsui to expand in the information technology sector. In 2013, they jointly launched the country's first high-speed 4G wireless communication service.