European colocation market set for another record-breaking year, but London market growth slows
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The collective take-up of colocation capacity across Europe’s four major datacentre hubs has hit record highs in the first six months of 2019, despite a marked slowdown in London.
That is according to real estate consultancy CBRE’s latest European quarterly market tracker, which monitors the supply and take-up of colocation capacity across Frankfurt, London, Amsterdam and Paris (FLAP).
Second-quarter data shows that take-up across these four markets topped 57MW during the three months to the end of June 2019, contributing to a record half-year take-up figure of 98MW in total, which is 11MW higher than the previous first-half record.
As in previous years, much of this demand is being driven by the hyperscale cloud and internet service provider community needing ready access to large-scale datacentre facilities to meet growing user demand for their offerings.
The Frankfurt market is responsible for most of the take-up across FLAP during the first half of the year, with the region accounting for 44MW out of the 98MW recorded.
According to CBRE’s projections, Frankfurt is now on course to exceed a full-year take-up total of 77MW, which is what the London market achieved during its record-breaking year of 2018.
But 2019 take-up rates within the London colocation market are comparatively subdued so far, having recorded the lowest take-up of any of the FLAP markets in the first half of the year.
“London had a poor start to the year, recording its lowest H1 since 2015,” said CBRE in its Q2 report.
However, the market watcher said take-up is likely to pick up again within the UK capital in due course, given that the downturn in demand London is now seeing can be attributed to its record-breaking performance in 2018.
“The hyperscale companies procured so much capacity during 2018 that they are now selling this capacity before they will need to acquire more,” said the CBRE report.
“CBRE is confident that the hyperscalers will come back to London aggressively and, when they do, there will be a number of new facilities that are nearing completion.”
These include new-builds from the likes of Ark Data Centres, CyrusOne, NTT and Virtus, which CBRE calculates will result in the creation of 78MW of additional capacity in London over the next six months.
While FLAP is collectively on course for another record year of take-up, ongoing concerns about the availability of land and power in some regions is resulting in overflow areas on the outskirts of some of these cities, said CBRE.
This is the case in Amsterdam, where acute power supply and availability issues have resulted in some parts of the city being deemed off-limits to datacentre developers, for the time being, prompting operators to seek alternative sites outside these restricted zones.
For this reason, CBRE said it does not anticipate any significant slowdown in the growth rate of Amsterdam as a colocation hub as a result of these restrictions.
Rounding off its analysis of the big four colocation hubs, CBRE said Paris enjoyed a “solid” first half of the year, as the hyperscalers continue to build out their datacentre presence in France.
On top of this, the location is also reaping the benefits of the City of Paris’s decision to host all of its data locally in an on-premise datacentre.
Mitul Patel, head of Europe, Middle East and Africa (EMEA) datacentre research at CBRE, described current activity in the European colocation market overall as extraordinary, with no signs of that changing.
“Take-up records are broken every quarter and hyperscale cloud companies continue to be at the epicentre of this,” he said. “As a consequence, winning hyperscale business is more competitive than ever and companies are competing on a number of criteria, including price.”
source computerweekly
Industry: Data Centre / Data Center

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