Data Centres: A Combination of Real Estate & Technology

In a world where technology is developing at pace and constantly changing the way we operate our day-to-day lives, it’s not surprising that the demand for data centres is increasing.

The growth of digital usage in consumer’s personal lifestyles such as online video streaming, media downloads, social network usage, online shopping, banking and information services, all require data storage.

Although we may be seeing less equipment and devices seem to be shrinking in size, technology adoption is speeding up, therefore the data used and needed to be stored is growing.

Technology advancements have resulted in IT requirements growing in scale and complexity, resulting in many businesses choosing to house their IT equipment and date-centre with a third-party specialist. Services such as the cloud, artificial intelligence and Internet of Things (IoT) are growing rapidly, especially within businesses, so the volume of data needed to be stored, processed and distributed to utilise these innovations is growing fast.

With data protection increasing in importance and consumers expecting services faster and faster, tighter security, exceptional reliability and state-of-the-art speed and connection are needed. These requirements have resulted in a boom in this area of commercial real estate with big blue-chip clients (as well as smaller companies) looking to acquire space increasingly.

Gartner predicts the market size and growth of the cloud service industry at nearly three times the growth of the overall IT services industry through 2022. They also anticipate 70% of organisations will integrate AI to assist employee’s productivity by 2021.

Data centres are quickly becoming highly recognised within the real estate market, offering the opportunity to diversify portfolios with a new, alternative asset with rapid growth prospects.

It is vital that before investing, research is done to understand the challenges and opportunities of these complex assets to ensure the value of service provided is not compromised and flexibility is available to develop alongside technology advancements. Warehouses that can provide the energy needed to sufficiently run and manage this data, securely and with speed, can offer lucrative returns to investors.