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The Western Europe data center construction market is expected to grow at a CAGR of 4.33% during 2022 to 2028. There is a high demand from organizations for retail colocation services in developing countries. Enterprises having limited budgets and demanding geographical distribution capacities will drive the demand for retail colocation services. There is an increasing demand for computing power from cloud providers, enterprises, IoT, and Big Data organizations, which will drive wholesale colocation demand. Speak directly to the analyst to clarify any post sales queries you may have.
- Germany leads the Western Europe data center market with an overall investment of over USD 1.8 billion in 2022. The country's cumulative growth is expected to be more than USD 12 billion during the forecast period.
- The growth in data center development has led the contractors to implement new sustainable methods, increasing the competition among them. Operators opt for these contractors to enhance their green credentials.
- There is significant growth in greenfield and modular data center developments. The modular data center developments are increased as the construction methods are seemed inefficient due to labor shortages, budget constraints, and construction delays in certain countries across the region. The increased demand for modular solutions from data center operators is increasing the revenue of modular data center solutions providers such as Vertiv, Dell, and HPE, among others.
- The power capacity is expected to grow significantly in the region with the advent of colocation and hyperscale operators investing highly in the market. There is a trend of procuring energy harnessed from renewable power sources by colocation, hyperscale, and colocation service providers.
KEY TRENDS & DRIVERS
Growing Adoption of Artificial Intelligence
The adoption of artificial intelligence is fueling data generation and the technology market, thereby increasing the need for data center construction. Eurostat released a report according to which Ireland ranks at the top in Europe in using AI/ML technologies by businesses and enterprises in their infrastructure or applications.Several AI initiatives in countries across the region include global partnerships on artificial intelligence, a mission on artificial intelligence, a national strategy on artificial intelligence, and others. For instance, The Government of France invested around USD 1.7 billion in its National Strategy for Artificial Intelligence. The high adoption of AI/ML solutions is prompting the installation of a highly efficient cooling infrastructure. Liquid cooling is the prominent technology for supporting AI/ML workloads in High-Performance Computing (HPC). Direct-to-chip and liquid-immersion cooling markets, through OEM, are making strong bonds. Research & Development centers are being set up for innovations in AI and other applications across various Western European countries. For instance, R&D centers for AI have been set up by companies such as Google, Oracle, and Huawei.
Increase in Sustainable Initiatives
- Data centers, the major sources of carbon emissions worldwide, are looking for sustainable initiatives to reduce the high quantity of CO2 emissions generated by the facilities. According to the Europe Climate act, a part of the European Green Deal, countries across the continent are aiming to achieve net zero carbon emissions by the year 2050.
- Various operators in Western Europe are a part of the Climate Neutral Data Center Pact act, such as Interxion (Digital Realty), Aruba, OVHcloud, Equinix, and Scaleway data center, among 17 industry associations. The pact states that the facilities part of it must be powered completely using energy harnessed from renewable energy sources such as wind, hydro, solar, and others by 2030. The Government of the UK aims to achieve 100% renewable energy in its energy mix by 2035.
Rising Colocation Data Center Investments
- The Western Europe data center construction market has shown signs of growth with the development of hyperscale data centers by cloud service providers such as Microsoft, IBM, Amazon Web Services (AWS), Oracle, Google, and Tencent. The prominent investors in the Western Europe data center construction include Equinix, Interxion (Digital Realty), NTT Global Centers, Echelon Data Centres, Iron Mountain, OVHcloud, Vantage Data Centers, and VIRTUS Data Centres.
- In August 2022, Proximity Data Centres opened a data center in Buckinghamshire. A loan of USD 30.8 million was granted to the operator for its UK expansion, with a total investment of USD 99 million. OVHcloud, a cloud computing, has planned to invest around USD 101 million by 2027 for its upcoming data center in Limburg. Telehouse has planned an investment of around USD 988 million for its European expansion. Telehouse plans an investment of around USD 988 million for its expansion in countries across Western Europe and other regions in Europe. An increase in data center investment will provide huge revenue opportunities for construction contractors and colocation and infrastructure providers worth billions of dollars.
Support of The Government For Data Centers
- One of the prominent enablers for the Western Europe data center construction market is breaks and tax incentives offered in various countries, which generate significant savings and incorporate other benefits.
- The Government of Spain is investing highly in the country’s overall digitalization. The government has planned around USD 720 million to strengthen Artificial Intelligence in the country.
- The Government of France reduced the electricity taxes and will help attract investments in the country.
- The UK government has placed a corporate tax of 20%, the lowest amongst G20 countries.
- The Federal Act on Data Protection (FADP) in Switzerland includes a few GDPR adaptations, which will aid in attracting further investments for data centers in the country.
- The French Government offers tax incentives for Research & Development up to 30% and has a limit of USD 97.48 million.
- The Dutch government is undertaking initiatives to bring the country to the forefront of the Western Europe data center construction market. The sales and VAT rate in the country is over 20%.
- The Government of the Netherlands is taking initiatives to increase the country’s data center market portfolio and reach. The VAT and sales tax in the country stands above 20%.
- Tax incentives are available in most Western European countries. More tax breaks will be concentrated on less developed countries to attract investment in the Western Europe data center construction market.
SEGMENTAL ANALYSIS
- Significant investment growth due to the advent of technologies such as cloud computing, Big data & IoT, and M/L Technologies.
- Increasing growth in the construction of modular data centers is being observed.
- Operators are adopting the turnkey approach for designing new data center facilities.
- Greenfield projects will encounter more growth as compared to brownfield.
- The brownfield development of data centers will continue to grow along with installing on-site renewable power sources.
Facility
- Colocation Data Center
- Hyperscale Data Center
- Enterprise Data Center
Infrastructure
- Electrical Infrastructure
- Mechanical Infrastructure
- General Construction
Electrical Infrastructure
- UPS Systems
- Generators
- Transfer Switches & Switchgear
- PDUs
- Other Electrical Infrastructure
Mechanical Infrastructure
- Cooling Systems
- Racks
- Other Mechanical Infrastructure
Cooling Systems
- CRAC and CRAH Units
- Chillers Units
- Cooling Towers, Condensers, and Dry Coolers
- Economizers & Evaporative Coolers
- Other Cooling Units
Cooling Techniques
- Air-based Cooling
- Liquid-based Cooling
General Construction
- Core & Shell Development
- Installation & Commissioning Services
- Engineering & Building Design
- Fire Detection & Suppression
- Physical Security
- DCIM/BMS Solutions
Tier Standard
- Tier I & Tier II
- Tier III
- Tier IV
Geography
- UK
- Germany
- France
- Netherlands
- Ireland
- Switzerland
- Italy
- Spain
- Belgium
- Portugal
- Luxembourg
- Other Western European Countries
COMPETITIVE ANALYSIS
Some of the major vendors operating in the Western Europe data center construction market include Arup, AECOM, Ariatta, Bouygues, ICT facilities, Mercury, Metnor Group, Oakmont Construction, ARC:MC, Kirby Group Engineering, DPR Construction, Turner & Townsend, Gruner, Lupp Group, Max Bogl, Exyte, DBA PRO, Future-tech, ISG, and NORMA.Prominent Support Infrastructure Providers
- 3M
- ABB
- Airedale International Air Conditioning
- Alfa Laval
- Carrier
- Caterpillar
- Condair
- Climaveneta
- Cummins
- D’HONDT THERMAL SOLUTIONS
- Daikin Applied
- Delta Electronics
- Eaton
- ebm-papst
- EMICON INNOVATION AND COMFORT
- Enrogen
- FlaktGroup
- Grundfos
- Güntner
- GESAB
- HiRef
- HITEC Power Protection
- Honeywell International
- Johnson Controls
- KOHLER-SDMO
- KyotoCooling
- Legrand
- Mitsubishi Electric
- Munters
- Nlyte Software (Carrier Global Corporation)
- Perkins Engines
- Piller Power Systems
- Riello Elettronica ( Riello UPS)
- Rittal
- Rolls-Royce
- Schneider Electric
- Siemens
- Socomec
- STULZ
- Trane (Ingersoll Rand)
- Vertiv
- ZIEHL-ABEGG
Prominent Construction Contractors
- AECOM
- AEON Engineering
- ARC:MC
- APL Data Center
- Ariatta
- ARSMAGNA
- Artelia
- Arup
- Atkins
- Basler & Hofmann
- BENTHEM CROUWEL ARCHITECTS
- Bouygues Construction
- Callaghan Engineering
- Cap Ingelec
- Collen
- Deerns
- DPR Construction
- Eiffage
- EYP MCF
- Ferrovial
- Future-tech
- ICT Facilities
- IDOM
- ISG
- JCA Engineering
- JERLAURE
- Kirby Group Engineering
- Linesight
- LPI Group
- M+W Group (EXYTE)
- Mercury
- Metnor Construction
- Nicholas Webb Architects (NWA)
- NORMA Engineering
- Oakmont Construction
- PM Group
- (PQC) Power Quality Control
- Quark
- RED
- Reid Brewin Architects
- Royal HaskoningDHV
- Skanska
- SPIE UK
- Starching
- STO Building Group
- STS Group
- TPF
- TTSP
- Turner & Townsend
- Winthrop Engineering and Contracting
Prominent Data Center Investors
- AtlasEdge
- Aruba
- China Mobile
- Colt Data Centre Services (COLT DCS)
- CyrusOne
- DATA4
- Digital Realty
- Echelon Data Centres
- EdgeConneX (EQT Infrastructure)
- Equinix
- Euclyde Data Centers
- Global Switch
- Iron Mountain
- KDDI
- Liberty Global
- Microsoft
- Nautilus Data Technologies
- NDC-GARBE Data Centers Europe
- NTT Global Data Centers
- Orange Business Services
- Proximity Data Centres
- Pure Data Centres
- T5 Data Centers
- Telecom Italia Sparkle
- Vantage Data Centers
- Virtus Data centers (ST Telemedia Global Data Centres)
- Yondr
New Entrants
- Global Technical Realty
- Stratus DC Management
KEY QUESTIONS ANSWERED
1. How big is the Western Europe data center construction market?2. What is the growth rate of the Western Europe data center construction market?
3. What factors drive the Western Europe data center construction market growth?
4. What is the estimated market size in terms of area in the Western Europe data center construction market by 2028?
5. Who are the new entrants in the Western Europe data center construction market?
6. How many MW of power capacity is expected to reach the Western Europe data center construction market by 2028?
Table of Contents
1 Research Methodology2 Research Objectives3 Research Process7 Market at a Glance
4 Scope & Coverage
5 Report Assumptions & Caveats
6 Premium Insights
8 Introduction
9 Market Opportunities & Trends
10 Market Growth Enablers
11 Market Restraints
12 Market Landscape
13 Facility Type
14 Infrastructure
15 Electrical Infrastructure
16 Mechanical Infrastructure
17 Cooling Systems
18 Cooling Technique
19 General Construction
20 Tier Standards
21 Geography
22 UK
23 Germany
24 France
25 Netherlands
26 Ireland
27 Switzerland
28 Italy
29 Spain
30 Belgium
31 Portugal
32 Other Western European Countries
33 Competitive Landscape
34 Prominent Support Infrastructure Providers
35 Prominent Construction Contractors
36 Prominent Data Center Investors
37 New Entrants
38 Report Summary
39 Quantitative Summary
40 Appendix
List of Exhibits
List of Tables
Companies Mentioned
- 3M
- ABB
- Airedale International Air Conditioning
- Alfa Laval
- Carrier
- Caterpillar
- Condair
- Climaveneta
- Cummins
- D’HONDT THERMAL SOLUTIONS
- Daikin Applied
- Delta Electronics
- Eaton
- ebm-papst
- EMICON INNOVATION AND COMFORT
- Enrogen
- FlaktGroup
- Grundfos
- Güntner
- GESAB
- HiRef
- HITEC Power Protection
- Honeywell International
- Johnson Controls
- KOHLER-SDMO
- KyotoCooling
- Legrand
- Mitsubishi Electric
- Munters
- Nlyte Software (Carrier Global Corporation)
- Perkins Engines
- Piller Power Systems
- Riello Elettronica ( Riello UPS)
- Rittal
- Rolls-Royce
- Schneider Electric
- Siemens
- Socomec
- STULZ
- Trane (Ingersoll Rand)
- Vertiv
- ZIEHL-ABEGG
- AECOM
- AEON Engineering
- ARC:MC
- APL Data Center
- Ariatta
- ARSMAGNA
- Artelia
- Arup
- Atkins
- Basler & Hofmann
- BENTHEM CROUWEL ARCHITECTS
- Bouygues Construction
- Callaghan Engineering
- Cap Ingelec
- Collen
- Deerns
- DPR Construction
- Eiffage
- EYP MCF
- Ferrovial
- Future-tech
- ICT Facilities
- IDOM
- ISG
- JCA Engineering
- JERLAURE
- Kirby Group Engineering
- Linesight
- LPI Group
- M+W Group (EXYTE)
- Mercury
- Metnor Construction
- Nicholas Webb Architects (NWA)
- NORMA Engineering
- Oakmont Construction
- PM Group
- (PQC) Power Quality Control
- Quark
- RED
- Reid Brewin Architects
- Royal HaskoningDHV
- Skanska
- SPIE UK
- Starching
- STO Building Group
- STS Group
- TPF
- TTSP
- Turner & Townsend
- Winthrop Engineering and Contracting
- AtlasEdge
- Aruba
- China Mobile
- Colt Data Centre Services (COLT DCS)
- CyrusOne
- DATA4
- Digital Realty
- Echelon Data Centres
- EdgeConneX (EQT Infrastructure)
- Equinix
- Euclyde Data Centers
- Global Switch
- Iron Mountain
- KDDI
- Liberty Global
- Microsoft
- Nautilus Data Technologies
- NDC-GARBE Data Centers Europe
- NTT Global Data Centers
- Orange Business Services
- Proximity Data Centres
- Pure Data Centres
- T5 Data Centers
- Telecom Italia Sparkle
- Vantage Data Centers
- Virtus Data centers (ST Telemedia Global Data Centres)
- Yondr
- Global Technical Realty
- Stratus DC Management
Methodology
Our research comprises a mix of primary and secondary research. The secondary research sources that are typically referred to include, but are not limited to, company websites, annual reports, financial reports, company pipeline charts, broker reports, investor presentations and SEC filings, journals and conferences, internal proprietary databases, news articles, press releases, and webcasts specific to the companies operating in any given market.
Primary research involves email interactions with the industry participants across major geographies. The participants who typically take part in such a process include, but are not limited to, CEOs, VPs, business development managers, market intelligence managers, and national sales managers. We primarily rely on internal research work and internal databases that we have populated over the years. We cross-verify our secondary research findings with the primary respondents participating in the study.
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Table Information
| Report Attribute | Details |
|---|---|
| No. of Pages | 467 |
| Published | April 2023 |
| Forecast Period | 2022 - 2028 |
| Estimated Market Value ( USD | $ 8.22 Billion |
| Forecasted Market Value ( USD | $ 10.61 Billion |
| Compound Annual Growth Rate | 4.3% |
| Regions Covered | Europe |
| No. of Companies Mentioned | 123 |
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