Savills: How AI is a Key Driver of EMEA Data Centre Growth

Savills reports that AI is now a key driver of data centre growth across EMEA, second to public cloud demand. 

International Data Corporation projects AI spending will reach US$144.6bn by 2028, a 30.3% compound annual growth rate between 2024 and 2028. Savills notes the compute required for training and deploying language models is placing pressure on regional infrastructure.

Cameron Bell, Director, EMEA Data Centre Advisory at Savills, says: “Geographically, we have seen demand remain highly concentrated.

“Despite discussion around location agnostic strategies when it comes to AI, very few such projects have translated into transactions. 

“Instead, operators are doubling down on existing availability zones, reinforcing consolidation in areas with established hyperscale footprints, reliable energy supply and space for scalable growth.

“While demand is gradually expanding beyond the traditional European hubs, the bulk of the requirements continue to cluster in the FLAP-D (Frankfurt, London, Amsterdam, Paris and Dublin) markets, supported by dense populations and the presence of large corporate occupiers.”

Capacity growth across FLAP-D and beyond

Savills records a 12% increase in live capacity over the past 12 months. Established hubs have expanded, with capacity in France up 15%, Germany 10% and the UK and Ireland 9%.

The Netherlands only saw a growth of 6%, which Savills links to an ongoing government moratorium on new developments.

There has also been a significant increase in non-traditional locations including Portugal (60%), Saudi Arabia (49%), Spain (25%), UAE (20%) and Sweden (17%).

Against this, Savills tracks 850MW of power capacity delivered across EMEA since the start of 2025, down 11% year on year.

New take-up in 2025 has reached 845MW, around half the power capacity leased in 2024. Savills attributes the slowdown to limited new facilities rather than weaker occupier demand.

Power constraints shape take-up and occupancy

Savills states that total contracted power capacity has risen to nearly 14,500MW, up 12% year on year. About one-fourth of take-up is now pre-let compared with less than 20% three years ago. Occupancy climbs to 91% in Q3 2025, from 87% in Q3 2022.

Cameron says: “The persistent imbalance between surging demand and restricted supply continues to underpin rental values. Following three years of sharp increases, average rents have stabilised across the region. 

“Nonetheless, with accelerating AI related requirements, rising energy costs and sustained construction inflation, further upward pressure on pricing is widely anticipated for the rest of 2025 and beyond.”

Investment flows and private equity backing

Savills notes ongoing investor interest. Since 2021, between 80–90% of the value of closed deals has been backed by private equity, real estate funds or infrastructure investors, compared with 50% in 2020. Fundraising for data centre vehicles by the end of Q2 2024 is almost 40% higher than the total raised in 2023.

Savills points to the sector’s role in the digital economy and the requirement for capital expenditure over time, despite power challenges.

Rising build costs across EMEA markets

Build costs across EMEA now range between US$7.3m and US$13.3m per MW of commissioned IT load. Savills cites the scope of costs, including land, shell, electrical and mechanical systems, cooling, fire safety and fit-out.

Markets with the sharpest annual increases include Vienna (+27.5%), Warsaw (+25.4%), Stockholm (+18%) and Copenhagen (+17%). A Turner & Townsend survey finds respondents report a 5–15% increase in the past year, with 22% experiencing higher increases.

Marc Edmondson, Director and data centre expert in the building & project consultancy team at Savills, says: “With construction timelines lengthening, capital expenditure is also rising. Greenfield construction costs have risen sharply, reflecting labour shortages, land scarcity and persistent supply chain issues. 

“Globally, this has seen average costs increase by more than 6% year-on-year. In EMEA this rise was even steeper at 9.7%. As a result, we are seeing developers responding with forward purchasing and closer ties with suppliers, whilst some are pivoting to emerging markets offering more accessible land and power.”