CBRE data reveals record-low vacancy rates in key European datacentre hubs

In Europe, the demand for datacentre capacity is surpassing supply at a rapid pace. Real estate consultancy CBRE’s quarterly market data shows that vacancy rates in major European cities like Frankfurt, London, Amsterdam, Paris, and Dublin (FLAPD) have reached an all-time low.

The FLAPD regions saw vacancy rates drop below 10% for the first time during the second quarter of 2024, as operators struggle to meet the increasing demand for capacity from hyperscale cloud and internet companies. Only 138MW of new datacentre capacity was delivered in the first half of 2024, while 155MW was taken up.

CBRE attributes the shortage of datacentre capacity to a lack of available power and suitable land for building. Despite this, demand from big American tech companies continues to rise, driving the need for more space to accommodate their plans.

The report highlights that only 30MW of new capacity was added in Q2, mainly due to a development in the western London corridor. CBRE predicts that take-up rates in London will surpass other FLAPD regions this year, except for Frankfurt.

Looking ahead, CBRE forecasts that the vacancy rate will drop to 7.9% by the end of the year, leading to increased pricing in the datacentre market. The situation is particularly challenging in Dublin, where a ban on power applications poses a threat to the city’s status as a major hyperscale datacentre market.

Despite these challenges, the future of the London market appears promising following government initiatives to ease planning barriers for new datacentre builds.

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