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Data centre operator NEXTDC (ASX: NXT) is making a “generational investment” in Australia’s technology future with development of its fourth digital campus in Melbourne as part of a $2 billion “AI Factory” that will become a nationally strategic hub for advanced manufacturing, aerospace, sovereign defence and deep tech.
The next-generation digital campus, M4, to be located at Fishermans Bend in Port Melbourne, will feature a Mission Critical Operations Centre and a Technology Centre of Excellence that is purpose-built for sovereign AI, high-performance computing and advanced manufacturing.
The Victorian Government says the facility will strengthen Australia's competitive edge across the Five Eyes intelligence alliance and position Victoria as a national digital infrastructure hub.
“This isn’t just a data centre - it’s critical infrastructure for Australia’s AI future,” says Craig Scroggie, CEO of NEXTDC.
“By anchoring M4 at Fishermans Bend, we’re activating a nationally integrated ecosystem for industrial AI, defence, research and deep tech.
“We are building the foundational infrastructure for Australia’s participation in the next wave of global innovation, from artificial intelligence and cloud computing to defence, quantum, and space technologies.”
Scroggie says M4 has been designed to meet the five critical imperatives for Australia’s AI future - speed, scale, sovereign capability, sustainability and security.
“No one builds the future alone,” he says.
“M4 will be the convergence point for partners shaping Australia’s AI era, from NVIDIA’s global leadership to our top-tier universities, to defence leaders building sovereign capability. This is where intelligence infrastructure, collaboration, and execution meet.”
The AI Factory will be a hyper-dense, liquid-cooled facility engineered for sovereign AI, designed to support NVIDIA’s Blackwell and Rubin Ultra architectures. The facility will deliver rack densities beyond 1,000kW, enabling model training, inference and frontier AI workloads at scale.
The Mission Critical Operations Centre will be a sovereign-grade, always-on control centre housed within Tier IV infrastructure to provide secure, fault-tolerant environments for high-stakes digital operations.
The Technology Centre of Excellence will be a national hub for AI skills, R&D and innovation to support engineers, students and startups to build and operate AI systems onshore, accelerating Australia’s capability in deep tech.
“This investment means thousands of jobs, training for the next generation of tech workers, and cements Victoria's reputation as the centre of innovation,” says Victorian Premier Jacinta Allan.
“We’re open for business, and we’re backing Victorians every step of the way.”
The tech hub is part of the state government’s emerging Fishermans Bend Innovation Precinct, kickstarted by an investment of $180 million and set to become a centre of innovation in advanced manufacturing, engineering and design.
The precinct is projected to support up to 30,000 jobs in science, technology, engineering and associated fields by 2051.
It will include the University of Melbourne’s new Engineering and Design campus, which aligns with NEXTDC’s new Technology Centre of Excellence.
“Digital infrastructure is economic infrastructure,” says Scroggie.
“AI factories are a new class of infrastructure, purpose-built for the industrial-scale production of tokens. M4 is a generational investment in capability, resilience and sovereign leadership, the infrastructure that will underpin Australia’s economic competitiveness in the fourth industrial revolution.”
Adam Evans, co-founder of specialist defence sector contractor and consultancy Anywise says the new innovation precinct “bodes well for business looking to expand their footprint in Victoria”.
“It will deliver the sort of cloud and AI infrastructure that businesses like ours are looking to leverage,” he says.
“AI and high-level compute capability will increasingly become part of the products and service life cycle for many in the area and add scale and agility to sectors like defence and other industries.”
The facility represents the biggest investment in Melbourne for the Brisbane-based NEXTDC, which has reported a record year of new contract signings for its data centres in Australia reflecting accelerating demand for high-density, AI-optimised infrastructure across the region.
The company this week revealed that following recent customer contract wins, its pro forma contracted utilisation as at 31 May 2025 had increased by 16MW, or 7 per cent, to 244MW since the previous update on 6 May 2025.
The largest increase in contracted utilisation came from NEXTDC’s data centre under development in Kuala Lumpur in Malaysia (KL1), which now totals 10MW, representing 15 per cent of its planned capacity.
The proposed M4 facility in Melbourne is among seven data centres the group has in the planning stages in Australia, with a fifth facility for Melbourne and an eighth for Sydney also under evaluation.
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