Global property advisor Knight Frank has revealed that Europe saw a 'monumental' £23.5 bn (€26 bn) investment into the data centre sector over the first half of 2020, despite the impact of Covid-19.
According to its new data centre report, produced in partnership with DC Byte, the recorded volume is over four times the $5 bn (€4.2 bn) annual average figure and a colossal increase on last year’s $2 bn investment volumes. Take-up in H1 2020 was also 50% higher year-on-year at 282 megawatts (mw).
The research considers all data centres as an asset class, including both enterprise and colocation developments, across 12 key European markets. It also highlights the rise of the ‘gigawatt markets’ – data centre markets where total supply of IT power is expected to exceed 1,000 mw in the next three years. Current Gigawatt markets are Frankfurt, London, Amsterdam and Dublin.
Meanwhile, Madrid, Copenhagen and Warsaw have emerged as the fastest growing European markets with over 700 mw of enterprise hyperscale and build-to-suit developments between them in planning or active development.
This comes as data centre developments expand outside of traditional hubs to create smaller clusters, including Amazon developing 300+ mw in Spain, and Google, Facebook and Apple developing new schemes in Copenhagen, combined with announcements of new cloud regions in Poland, Milan and Madrid.
Most demand for more or new data centre space and power is cloud-led, and Knight Frank is seeing an increasing migration from on-premise server storage to public cloud, most notably within the financial sector.
Stephen Beard, partner and head of EMEA and APAC data centres at Knight Frank, said: 'We are pleased to launch a pioneering report on the European data centre market, which demonstrates the growth and increasing significance of the sector with investment and take-up increasing year-on-year.
'There are often a lot of assumptions made in the market, typically based on how countries have delivered in the data centre sector in the past. A number of these new findings will challenge that thinking. We predict that the sector will only continue to grow in importance, particularly given the increased remote working and digitisation of companies as a result of the Covid-19 pandemic.'
Knight Frank expects that the European data centres market will mature and expand over the next year and that 2021 will see at least a 10% increase in cloud and wholesale take-up levels owing to further adoption and migration to public cloud in the short term.
It predicts that even those markets that appear to be underperforming in this report, in particular Paris, will see increased development activity in the rest of 2020 and into 2021.
