TALKING BUSINESS

Alexandra Thorer, Chief Growth Officer at BCS Consultancy

a market dynamic actively influencing current development pipelines.

As a result, growth is being redistributed into secondary German locations. Berlin saw a three-year compound annual growth rate of over 40 % between 2020 to 2023 and is the fastest-growing secondary market in Germany. The Rheinisches Revier region is emerging as a hub for Artificial Intelligence and cloud computing. Both markets are gaining traction, supported by more favourable grid access and development conditions.

Frankfurt remains the centre of gravity in Germany, but a broader shift is taking place to regions where delivery is more achievable.

The Nordics are becoming a primary geography

The role of the Nordics within the European market is also evolving. Historically seen as an alternative or emerging region, the Nordics are moving into the mainstream of data centre strategy.

The primary driver is energy. Access to abundant, low-carbon and renewable power is becoming a critical requirement, particularly as AI workloads drive higher power densities. According to Bloomberg Intelligence, the Nordics have some of the lowest electricity costs in Europe, averaging around 60 % below other markets, with parts of Norway and Sweden seeing discounts of up to 80 – 90 %. At the same time, long-term energy security and pricing stability are becoming decisive factors in site selection. These are not marginal considerations; they are increasingly central to investment decisions.

Supported by strong digital infrastructure and continued investment in grid expansion, the Nordics are positioning themselves as a primary geography for hyperscale and AI-led deployments. Their value is no longer defined by climate or cost, but by their ability to support long-term, energyintensive growth.

Iberia is transitioning to a strategic platform

Iberia is undergoing a more structural repositioning. For many years, it has been viewed primarily as a cost-led alternative to the FLAP-D hubs. That framing is becoming less relevant. Increased investment, improving connectivity and expanding renewable energy capacity are reshaping its role within the European market.

What Iberia offers today is a combination that is becoming increasingly difficult to find elsewhere: land availability and rare oversupply of electricity due to high renewable energy generation relative to demand. However, the next phase of growth will be shaped by the same constraints seen across Europe. Grid capacity, permitting timelines and regional power limitations will determine how quickly and effectively projects can be delivered.

Iberia is no longer a peripheral option, but rather a strategic platform for scalable capacity as long as delivery risks are understood and managed from the outset.

France is accelerating through alignment

France presents a different model of growth, characterised by alignment. The country benefits from a stable, low-carbon energy mix, underpinned by nuclear power. More significantly, there is a clear alignment between national policy, digital infrastructure and industrial strategy.

France’ s ambition to position itself as a leading AI hub off the back of a € 109 billion AI infrastructure investment last year is translating into coordinated action. Planning processes are being accelerated and power availability is being prioritised through state-backed mechanisms. This level of alignment is enabling a more structured approach to delivering data centre capacity. That said, longstanding characteristics remain. Administrative complexity and approval timelines continue to require careful navigation. Delivery in France is supported by policy, but still dependent on execution capability. Ultimately, what differentiates the market is not the absence of constraints, but the degree to which they are being addressed in a coordinated way.

Italy is becoming an execution-led market

Italy’ s development is being shaped less by scale and more by execution. Demand is no longer the defining challenge. Instead, success is increasingly tied to how effectively projects navigate power availability, planning complexity and stakeholder coordination.

This shift is driving renewed investor confidence, with Italy’ s data centre market described as entering a‘ golden era’ and attracting tens of billions in investment, according to Bird & Bird.

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