Europe Data Center Colocation Market - Industry Outlook & Forecast 2026-2031

The Europe data center colocation market size by investment is expected to grow at a CAGR of 25.94% from 2025 to 2031.

EUROPE DATA CENTER COLOCATION MARKET TRENDS

Rise in Adoption of Liquid Cooling Techniques

• In Europe, data centers are increasingly adopting liquid cooling techniques as traditional air-based cooling techniques are increasingly strained by increasing high-performance computing (HPC), AI workloads, and increasing rack power densities.
• Therefore, data center operators are shifting toward liquid cooling techniques as liquid cooling offers enhanced thermal management, energy efficiency, and support for modern computing workloads efficiently.
• In November 2025, Vertiv announced that it has launched the CoolCenter Immersion system pod; this can support around 25 kW to 240 kW per system, and this is now available in Europe, the Middle East, and Africa (EMEA).

The Rise in AI Adoption

• The Netherlands acquired the fourth rank globally in the Government AI Readiness Index 2025. The country leads Europe in AI adoption, with 95% of organizations running AI programs.
• In September 2025, Carbon3.ai, the UK-based AI infrastructure firm, launched a sovereign AI platform in collaboration with Hewlett Packard Enterprise and other companies to boost artificial intelligence development across the country.
• The Government of Finland launched the Artificial Intelligence 4.0 programme in 2022 for the period 2022-2030. The main objective of the programme is to accelerate the development and adoption of AI and related digital technologies across the economy.
• The French government supports AI through various initiative programs. For instance, in July 2025, the French government announced that it has launched the national plan "Dare to Use AI". The main objective of this program is to accelerate AI adoption across all French companies, especially small and medium-sized enterprises (SMEs) and mid-sized companies by 2030. Additionally, it set a goal of 100% of major French companies, 80% of SMEs/mid-sized companies, and 50% of micro-enterprises using AI by 2030. It has three main pillars such as Raising awareness to promote AI adoption, providing training via an AI Academy, and supporting companies to identify relevant AI solutions.
• In January 2025, Data Center Partners announced its plan to build an AI-ready data center in Munich, with an IT capacity of over 17 MW; this facility will be designed to handle the high-demand AI and Machine Learning (ML) workloads.

Rise in District Heating Concept

• District heating works like a central heating network, where the waste heat from a central source is supplied to multiple end-users through insulated pipes. District heating networks help data center operators to minimize carbon emissions significantly. Therefore, several data center operators in European countries are increasingly connecting data center facilities to local district heating networks.
• In February 2026, nLighten signed an agreement to supply waste heat from its data center in Stuttgart, Germany, to the local district heating network. The project is likely to deliver around 1.8 MW of heat, helping support the decarbonization and sustainable energy initiatives of the city.
• In August 2025, Borealis Data Center signed an agreement with Finnish public utility Loiste Lampo Oy to capture and reuse waste heat from its data center campus in Kajaani, Finland. The system is expected to become operational by May 2026, with the recovered heat used to supply homes and businesses in the Kajaani region.

EUROPE DATA CENTER COLOCATION MARKET SEGMENTATION INSIGHTS

• The Europe data center colocation market continues to witness robust growth, driven by accelerating cloud adoption, hyperscale expansion, AI workloads, and enterprise digital transformation across major markets including the UK, Germany, France, the Netherlands, Ireland, Spain, Italy, and the Nordic countries. The colocation market revenue is projected to increase to $43.45 billion by 2031. The rapid expansion of hyperscale campuses and increasing enterprise outsourcing of IT infrastructure continue to drive investments in modern colocation facilities across the region.
• Electrical infrastructure accounts for a significant share of investments owing to the growing deployment of high-density racks and AI-ready infrastructure. Investments are primarily focused on UPS systems, generators, switchgear, transformers, PDUs, and resilient power distribution systems to ensure continuous availability and support rising rack power densities.
• Mechanical infrastructure is projected to record the fastest growth among the segments as operators increasingly deploy advanced cooling technologies to support AI and high-performance computing workloads. Liquid cooling, direct-to-chip cooling, rear-door heat exchangers, free cooling, and energy-efficient chillers are expected to witness significant adoption as operators focus on improving energy efficiency and reducing Power Usage Effectiveness (PUE).
• General construction continues to represent a major portion of overall investments, supported by large-scale greenfield developments and modular data center deployments. The segment is registering a CAGR of 25.62%. Continued investments in core & shell development, sustainable building materials, prefabricated construction techniques, and expansion of multi-building campuses are expected to drive this segment.
• Retail colocation continues to maintain a strong presence in Europe, supported by enterprise demand for carrier-neutral facilities, hybrid cloud deployments, and managed colocation services. Growth is primarily driven by small and medium enterprises, financial institutions, healthcare organizations, and government agencies seeking secure, interconnected, and compliant colocation environments.

EUROPE DATA CENTER COLOCATION MARKET GEOGRAPHICAL ANALYSIS

• Western Europe continues to dominate the Europe data center colocation market, accounting for the largest share of investments owing to the presence of mature digital infrastructure, major internet exchanges, extensive subsea cable connectivity, and a high concentration of hyperscale cloud regions.
• The United Kingdom remains Europe's largest colocation market and is expected to grow at a CAGR of 28.84%. London continues to be Europe's leading colocation hub due to its dense connectivity ecosystem, financial services sector, and concentration of hyperscale cloud availability zones.
• In October 2025, QTS Data Centers initiated the site preparation works to start the construction of the Project Wind data center campus, comprising 10 data center buildings with an investment of around $13.2 billion.
• Germany continues to be one of Europe's largest markets, driven primarily by Frankfurt's position as a major internet exchange and cloud hub. The market is supported by strong enterprise digitalization and increasing AI infrastructure deployments.
• Spain is witnessing rapid expansion as Madrid strengthens its position as a Southern European digital hub. The market's growth is supported by submarine cable landings and increasing demand for cloud infrastructure.
• Italy continues to attract increasing investments, particularly around Milan. The country is benefiting from enterprise cloud migration and growing hyperscale activity.
• The Nordics are emerging as the fastest-growing region in the European colocation market, driven by abundant renewable energy resources, low-carbon electricity, favorable climatic conditions for free cooling, and increasing AI investments.
• Among the Nordic countries, Norway and Sweden are witnessing substantial investments due to renewable hydropower availability and sustainable operating conditions. Finland is expected to record the highest growth during the forecast period, making it one of Europe's fastest-growing colocation markets as operators increasingly deploy AI-ready campuses.
• Retail colocation dominated in Sweden in 2025, with a higher capacity and market share than its wholesale counterpart. Several sectors, including entertainment and media, tourism, education, healthcare, oil and gas, as well as retail, are the major sectors that contributed to the high demand for retail colocation. However, the demand for wholesale colocation is expected to grow owing to the increasing use of cloud-based services; cloud operators are slated to store a part of their workloads via wholesale colocation.
• Central & Eastern Europe (CEE) continues to gain momentum as operators diversify beyond traditional FLAP-D markets. Poland remains the leading investment destination in the region, supported by increasing cloud deployments, growing enterprise demand, and strategic connectivity, while Austria and Czechia are also witnessing increasing investments in carrier-neutral and enterprise colocation facilities.

EUROPE DATA CENTER COLOCATION MARKET VENDOR LANDSCAPE

• The Europe data center colocation market is highly competitive, with the presence of global and regional colocation providers and domestic data center companies competing across retail and wholesale colocation services. Operators are expanding their footprints through greenfield developments, acquisitions, joint ventures, and AI-ready campus developments across major markets such as London, Frankfurt, Paris, Amsterdam, Dublin, Madrid, Milan, Warsaw, Oslo, Stockholm, and Copenhagen. The market remains moderately consolidated, with global operators accounting for a significant share of operational capacity while regional providers continue to strengthen their presence in secondary European markets.
• Leading colocation operators in the Europe data center colocation market include Equinix, Digital Realty, NTT DATA, CyrusOne, Vantage Data Centers, Telehouse, Global Switch, Colt Data Centre Services, Data4, AtlasEdge, EdgeConneX, Iron Mountain, STACK Infrastructure, VIRTUS Data Centres, Yondr Group, Green Mountain, atNorth, Kao Data, Bulk Infrastructure, Ark Data Centres, Pure Data Centres Group, QTS Data Centers, EcoDataCenter, CloudHQ, OpCore, Artnet, STORESPEED, Global Technical Realty, K2 STRATEGIC, offering retail, wholesale, hyperscale, edge, and AI-ready colocation services across Europe.
• The market is witnessing increasing investments from new entrants and developers, including 1911 Data Centers, ACS Group, Ada Infrastructure, SWI Group, Apatura, Apto, Arcem, Aroundtown SA, Art Data Centres, Blue Star, Brookfield, Corscale Data Centers, G42, GreenScale Data Centres, Polarnode, and VSDATA. These companies are focusing on developing hyperscale campuses, AI-ready infrastructure, powered land developments, and sustainable data center projects to capitalize on growing enterprise and cloud demand across Europe.
• Competition in the European colocation market is increasingly centered on AI-ready infrastructure, renewable energy sourcing, liquid cooling deployment, carrier-neutral connectivity, large-scale wholesale capacity, and expansion into secondary European markets. Operators are differentiating themselves through sustainability initiatives, high-density computing capabilities, and strategic partnerships with hyperscale cloud providers, which continue to drive capacity additions across the region.

Prominent Colocation Operators

• 3data Premium Data Centers
• Play Business Solutions
• Aire Networks
• AQ Compute
• Ark Data Centres
• Artnet
• Aruba SpA
• Atlantic Data Infrastructure
• AtlasEdge
• Atman
• atNorth
• Atomdata
• Bahnhof
• Beyond.pl
• Blue
• Bulk Infrastructure
• China Mobile International
• CloudHQ
• Colt Data Centre Services
• CyrusOne
• Data4
• DataCenter United
• Datum Datacentres
• DENV-R
• Digital Realty
• EcoDataCenter
• EdgeConneX
• Equinix
• Global Switch
• Global Technical Realty
• Green
• Green Mountain
• Serverfarm
• Iron Mountain
• IXcellerate
• K2 STRATEGIC
• Kao Data
• Keppel Data Centres
• LCL Data Centers
• Linxdatacenter
• maincubes SECURE DATACENTERS
• MERLIN Properties
• MTS
• Nation Data Center
• Nehos
• Nscale
• NTT DATA
• OpCore
• Penta Infra
• PHOCEA DC
• Polar
• Pure Data Centres Group
• QTS Data Centers
• Rostelecom
• Selectel
• STACK Infrastructure
• STACKIT
• STORESPEED
• Switch
• Telehouse
• Thesee DataCenter
• Vantage Data Centers
• VIRTUS Data Centres
• Yondr Group

New Entrants

• 1911 Data Centers
• Ada Infrastructure
• Adriatic DC
• AI Pathfinder
• SWI Group (AiOnX)
• AmpTank & Greensky Energy
• Anglesey Land Holdings
• Apatura
• Apto
• Arcem
• Argaman Group
• Aroundtown SA
• Art Data Centres
• Asia Pacific Land (APL)
• 3E Network Technology Company
• AVAIO Digital Partners
• Azora
• BADEN CLOUD
• Bilt Technology
• Bitzero Holdings
• Blue Star
• Brookfield
• Caineal LLP
• Claesson & Anderzen AB
• Cegeka
• Compass Datacenters
• Compute Nordic
• Corscale Data Centers
• DAMAC Digital
• Dante Group
• DATA CASTLE
• DATA for MED
• Data Center Partners
• DataHall
• dataR
• DayOne
• Deep Green
• Digital Reef
• Digital Land & Development
• Domyn
• Drax Group
• Era4
• ECO-LocaXion
• EDC One
• EdgeNebula
• Edora
• EID LLP
• Elite UK REIT
• Energia Group
• EngineNode
• Evroc
• FCDC Corp
• FF Ventures
• Firebird.ai
• FlexBase Group
• Form8tion Data Centers
• G42
• GARBE Data Centers
• GreenScale Data Centres
• Greenweaver
• Greystoke
• Grupo Samca
• Herbata
• Hillwood
• House of Data
• ICADE
• ILI Group
• Kennedy Wilson
• Keysource and Namsos DataSenter
• Latos Data Centres
• Liberum Navitas
• Link Park Heathrow
• Media StreamAI
• Mistral AI
• NEOIX
• NETHITS IT SOLUTIONS
• Northtree Investment Management
• Norwich Research Park
• Nostrum Group
• NXN Datacenters
• Origin Energy Services & Woodland Investment Management
• Osae Partners & NFU
• Panattoni
• PATRIZIA SE
• PGIM Real Estate
• Polarise
• Polarnode
• Portland Trust
• Prime Data Centers
• Prologis
• PPC
• Red Admiral DC
• Regant
• Sarenet
• Scale42
• SDC Capital Partners
• SEGRO plc
• Sesterce
• Shelborn
• Sierra DC
• sineQN
• Skygard
• Solano Renovables Espana
• Solaria Energia y Medio Ambiente
• Stoneshield Capital
• Suomen Energiainsinoorit Oy
• Teesworks
• Thylander
• Tritax Group
• Truman Estates
• Valencia Digital Port Connect
• Valore Group
• VDR & Colliers
• VITALI SPA Societa Benefit
• VSDATA
• Wilton International
• WS Computing AS
• X5 Group
• XTX Markets

Segmentation by Colocation Type

• Retail Colocation
• Wholesale Colocation

Segmentation by Infrastructure

• Electrical Infrastructure
• Mechanical Infrastructure
• General Construction

Segmentation by Electrical Infrastructure

• UPS Systems
• Generators
• Transfer Switches & Switchgear
• PDUs
• Other Electrical Infrastructure

Segmentation by Mechanical Infrastructure

• Cooling Systems
• Racks
• Other Mechanical Infrastructure

Segmentation by Cooling Systems

• CRAC & CRAH Units
• Chiller Units
• Cooling Towers, Condensers & Dry Coolers
• Economizers & Evaporative Coolers
• Other Cooling Units

Segmentation by Cooling Techniques

• Air-based Cooling
• Liquid-based Cooling

Segmentation by General Construction

• Core & Shell Development
• Installation & Commissioning Services
• Engineering & Building Design
• Fire Detection & Suppression
• Physical Security
• DCIM/BMS Solutions

Segmentation by Tier Standard

• Tier I & II
• Tier III
• Tier IV

Segmentation by Geography

• Western Europe
  • UK
  • Germany
  • France
  • Netherlands
  • Ireland
  • Switzerland
  • Italy
  • Spain
  • Portugal
  • Belgium
  • Greece
  • Other Western European Countries
• Nordic
  • Denmark
  • Sweden
  • Norway
  • Finland
  • Iceland
• Central & Eastern Europe
  • Russia
  • Poland
  • Austria
  • Czechia
  • Other Central & Eastern European Countries

KEY QUESTIONS ANSWERED:

1. How big is the Europe data center colocation market?

2. What is the growth rate of the Europe data center colocation market?

3. What are the key trends in the Europe data center colocation market?

4. How much MW of power capacity is expected to reach the Europe data center colocation market by 2031?

5. What is the estimated market size in terms of area in the Europe data center colocation market by 2031?