The London and Frankfurt data centre markets are predicted to enjoy a substantial boost in take-up this year, according to CBRE, as more mega-projects open to counter an ongoing squeeze in supply.
Researchers at CBRE expect a record 480MW of take-up in the Frankfurt, London, Amsterdam, Paris and Dublin data centre markets in 2023.
More than half (56%) of that amount is expected to be located in Frankfurt and London.
CBRE said an ongoing lack of new supply had a direct impact on demand in Q1, with take-up dropping to 28MW, a fraction of the 202MW in the previous quarter. More than half of Q1 take-up was realised in London (17MW), with a single deal accounting for the majority of this.
Only 2.9MW of supply was launched to market across Frankfurt, London, Amsterdam, Paris and Dublin during Q1 this year. Researchers said this was the lowest amount of new supply delivered in any given quarter for more than 11 years.
“Hyperscalers” – large-scale data centres – are expected to be responsible for the majority of demand this year, despite weaker economic conditions and slowing growth of companies’ cloud operations.
As such, a comparable level of supply is expected to be delivered to accommodate that demand. CBRE predicts operators will deliver 524MW of capacity in 2023, with a “flurry” of notable mega-projects due for completion in London, Paris and Frankfurt in the second half of the year.
Kevin Restivo, director for European data centre research at CBRE, said: “We expect momentum to gather over the year in the FLAPD markets as operators deliver facilities to meet growing levels of demand. As a result, we are on track for unprecedented levels of new supply this year, much of which we expect to be prelet to single tenants, notably in the tech sector.”
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