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CBRE: Cloud drives massive take-up of European colocation space in Q2

Real estate consultancy's latest look at the state of the European colocation market suggests cloud is continuing to drive supply and demand for datacentre space across the continent

Confidence in the future growth of the European colocation is holding firm, with the amount of available datacentre capacity rising 20% over the past year, CBRE data shows.

The real estate consultancy said spare capacity has come online in all four major European colocation hubs – including Frankfurt, London, Amsterdam and Paris – as the demand for cloud services continues to soar across the continent.                                                               

“One-sixth of all colocation supply in these markets has been brought on in the past 12 months,” CBRE noted in its second quarter analysis report on the performance of the European colocation market.

“The levels of new supply show no signs of abating as a number of further schemes are scheduled for the coming quarters. The new supply indicates strong confidence towards future take-up.”

Indeed, the second quarter has been name-checked by CBRE as only the fourth on record to see more than 30MW of colocation space taken up in all four markets, bringing the half-year total up to 58MW.

This is the highest amount of half-year take up seen to-date, and should result in total take-up for the year hitting 120MW, CBRE said.

This is down on last year, despite Q2 2017 seeing more take-up than the equivalent quarter in 2016, which CBRE has put down to the lower number of “build-to-suit” facilities coming online this year.

London was the top-performing market in the second quarter, with 15 MW of colocation space sold, predominantly to wholesale datacentre operators, with the capital also saw more take-up during the first half of 2017 than any of the other European hubs.

Mitul Patel, head of Europe, Middle East and Africa datacentre research at CBRE, said the results suggest confidence in the European market is higher than ever, as the cloud giants continue to buy up space in colocation facilities across Europe.

Read more about the colocation market

“The cloud companies that are driving recent growth in Europe show no signs of decelerating in their procurement of colocation space and developers are responding in-kind with an unprecedented level of build activity,” he said.

“The continued increase in our use of IT and reliance on the digital world, and thus the increased need for processing power, has led to record-breaking levels of new supply and take-up since 2016.

“In context, in the six quarters prior to 2016 we saw 90MW of new supply and 91MW of take-up. In the 6 quarters since, we have seen 204MW of new supply and 212MW of new take-up,” he added.

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