European datacentres market comment

Latest research from European Data Centres on the Q1 2011 has shown some improvement although demand remains tentative.

This is fairly similar to 2010 which was a subdued year for both take-up and supply in the European Tier-1 markets. Wait and see is the approach being adopted by occupiers and operators.

This is a reflection of the European economy with some renewed optimism albeit with a level of caution.

The major players are taking steps to position their operations in order to take advantage of untapped and longer term future demand, especially in the large enterprise market, while Tier-2 markets have seen some strategic expansion plans in the first quarter of 2011.

The lead times associated with new build projects and expansion plans mean that the benefit of any significant new datacentre supply is not likely to be seen until 2012 and 2013.

Changes in IT, particularly the acceptance of cloud computing strategies, will mean both expansion and consolidation of datacentres.

Additional demand is also likely to be driven by ever increasing reliance on IT infrastructure to support wider business objectives.