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Shift To Life Online Drives Data Centre Demand From Hyperscalers And Investors


Hyperscalers are behind an uptick in demand for London data centres, with as many as eight requirements now circling the city.

But new data centre requirements are increasingly focused on sustainable energy supplies.

The rise in supply in London’s already mature data centre market is inspired by lockdown demand and new data-hungry devices from Apple, and games hubs like Xbox and Playstation.

Linesight Managing Director Michael Riordan, whose consultancy is advising on 46 live data centre proposals across Europe, said demand is focused on larger providers — the hypserscalers like Amazon, Google and Facebook — because most of the UK’s data centre demand can be met from existing resources.

“Big tech is building, although predominantly in Europe because land and power is cheap and abundant compared to the UK, so it's more cost-effective," Riordan said. "But there are some large projects in and around London where operators are looking for 50MW of capacity or more.

“The trend in demand in London is generally up, thanks to more social media use but also Xbox, Playstation 5, the iPhone 12 — all of those are driving this, along with Covid-19 pushing more working from home onto the cloud.”

Research by JLL described the extent of hyperscaler demand in Europe, pointing to the recent purchase of a 33-acre site for new data centre development.

Colocation demand in Europe had a record year with a substantial 22% increase in take-up from 2019. London and Frankfurt drove much of the demand, with London recording a 72% increase year-over-year. Increased appetite for colocation demand is projected for 2021,” the JLL report said.

JLL reported a surge in interest in exploring sustainable energy options. Riordan agreed the trend was accelerating.

“The move to the use of renewables and green energy is going to be a big focus. The process has already started and hyperscalers are looking at alternative power sources like hydrogen. It is early days but operators are eager to explore,” Riordan said.

And the growth in demand for space is inevitably attracting investors. This week Singaporean REIT Ascendas paid £483M for a portfolio of 11 European data centres, its maiden acquisition in the market. Four of the centres are in the UK, with three in the Netherlands, three in France and one in Switzerland. It bought the portfolio from Digital Realty Trust. 

How is the expanding cloud influencing development plans for the UK? How are colocation providers in the UK responding to the increase in enterprise data centre development? How are the green and sustainability initiatives influencing facility requirements for the future? To join the conversation at the Bisnow UK Data Centre update register here