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Data Centers in Tel Aviv

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Tel Aviv – Gateway to the Eastern Mediterranean

Executive Summary

Tel Aviv is the essential hub for any business requiring high-performance digital infrastructure in Israel. Its dense connectivity and direct cloud access provide the low-latency foundation necessary to serve the nation's thriving technology sector and the broader Eastern Mediterranean market. This market is built for speed and uptime, connecting global enterprises to one of the world's most innovative economies.

Tel Aviv: At A Glance

FactorRating / DataNotes
Global Connectivity GradeAExcellent subsea cable access and strong carrier density.
Direct Cloud On-RampsOver 2 — as of September 2025Direct access to AWS. Private extensions available to other major clouds.
Power Cost₪0.45 – ₪0.65/kWh (est.) — as of September 2025Costs are competitive for the region, supporting high-density deployments.
Disaster RiskModerate (3.2/10) — as of September 2025Primary risks include seismic activity. Facilities are engineered accordingly.
Tax IncentivesYesTemporary importation and tax/VAT exemption routes are available for equipment.
Sales Tax18% VAT — as of September 2025Standard Value Added Tax applies to most goods and services.

Network & Connectivity Ecosystem

Carrier Density & Carrier Neutrality The market features a healthy ecosystem of over 5 network providers as of September 2025. Multiple carrier-neutral data centers offer access to this diverse mix, creating a competitive environment for transit and transport services.

Direct Cloud On-Ramps The Tel Aviv market provides over 2 direct cloud on-ramps as of September 2025, supporting low-latency hybrid cloud architectures across 2 cloud regions. Direct, private connectivity is available to AWS. Access to other hyperscale clouds is commonly achieved via network provider partnerships.

Internet Exchange Points (IXPs) The Israel Internet Exchange (IIX) is the primary peering point for the country. Its presence in Tel Aviv data centers reduces latency for domestic traffic and improves network performance for end-users.

Bare Metal Bare metal server solutions are readily available from multiple providers. Options include global suppliers like phoenixNAP, offering dedicated compute for performance-sensitive applications that require direct hardware access.

Power Analysis

Average Cost Of Power Industrial power costs are estimated between ₪0.45 – ₪0.65/kWh as of September 2025. This competitive pricing structure makes high-density compute deployments financially viable.

Power Grid Reliability The national power grid is reliable, particularly within the central business districts where data centers are concentrated. Modern colocation facilities are supported by redundant grid connections from multiple substations, ensuring high levels of uptime.

Market Access, Business & Tax Climate

Proximity To Key Business Districts Data centers in and around Tel Aviv provide low-latency access to Israel's primary financial district and the "Silicon Wadi" high-tech corridor. This proximity is critical for financial trading, ad tech, and R&D operations that depend on speed.

Regional Market Reach Tel Aviv is the ideal location for serving the entire Israeli market. It also functions as a strategic digital outpost for multinational companies targeting consumers and businesses in the Eastern Mediterranean and parts of the Middle East.

Tax Advantage For Data Centers The primary tax advantage involves pathways for the temporary importation of equipment. These programs allow for significant cost savings by providing exemptions from import taxes and VAT on servers and networking hardware.

Natural Disaster Risk

The overall risk profile for Tel Aviv is moderate, with a composite INFORM Risk score of 3.2 out of 10 as of September 2025. Key natural hazards are weighted toward seismic events and long-term climate conditions. The most significant risks for the region include:

  • Earthquake: 6.9/10
  • Drought: 5.3/10
  • Tsunami: 2.7/10
  • Coastal Flood: 2.4/10
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