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The latest news and events at Maples Teesdale

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Data centres – a growing market which may have an increased nationwide footprint

In a recent blog post, Kevin Mofid at Savills predicted significant growth in the data centre property market in the coming years, particularly relating to AI. The European market is expected to grow by over 25% this year and then over 15% each year to 2030. Savills’ experience so far this year has also led them to anticipate tough competition for suitable land, which is likely to be property previously allocated for industrial and logistics purposes. 

Historically, data centres have been located  around London and the Southeast, near financial markets and fibre connections.  The rise of AI and cloud computing has seen data centres spring up outside their traditional heartland. Savills have seen deals in Yorkshire, Wales and the Northeast in the last 12 months.

Data centres will need to navigate a rapidly developing legal, regulatory and policy landscape, in respect of energy consumption and sustainability, for example. This, combined with high construction and planning costs, may make locations outside London and the Southeast where land is less expensive increasingly popular. It will be interesting to see if these factors lead to a wholesale shift in data centre locations away from London and the Southeast, but in any case Savills’ optimistic outlook for the growth of data centres is great news for the UK commercial property market in general. 

The data centre market is poised for significant growth in the coming years, with forecasts indicating a substantial increase in demand particularly when it comes to Artificial Intelligence (AI).

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data centres, anna mcdowell, industrial, logistics, industrial and logistics, commercial real estate, industrial & logistics