Real estate law watch
Whilst data centres are often seen as a complex asset class in which to invest by those outside of the sector, institutional and other property investors are beginning to see that behind the technical jargon lies a very attractive investment class.
Many corporations, whether global or localised, require the use of data centres. This could be as occupiers of whole or part, owner occupiers or investors seeking returns from the grant of institutional type leases. The recent increase in demand, which appears set to continue, has led to significant investment in recent years. 2012, in particular, showed a significant increase in supply growth, with several of the major data centre operators announcing new schemes which should provide confidence as to the sustainability of the sector. Despite the increase in development schemes, demand is outstripping supply. This is due to a number of factors including companies being required to store regulatory and financial information for longer periods, and the increase in capacity necessary to facilitate cloud computing and other technological developments.
It is generally acknowledged that London, Frankfurt, Paris, Amsterdam and Madrid are the core European centres of the global data centre market. Of those London is arguably seen as Europe's leading location as it benefits from the competitive advantage provided by data centres being close to a major international financial centre. This avoids even the smallest of delays in the flow of information.
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