Ireland set for boom in data centre funding

THE vast majority of debt and equity investors expect funding into European data centres to increase over the next two years, according to research from law firm DLA Piper.

Data centres are used by businesses for the remote storage, processing and distribution of large amounts of information. They are estimated to use 3-4pc of the world’s power, according to a report from Savills.

Of the eight countries examined, Ireland was among the top three expected to experience the biggest growth in investment.

There are currently 54 data centres here, with 642 megawatts (MW) of grid-connected power capacity.

Last month, the ‘Sunday Independent’ reported that EngineNode, an Irish data centre company, had applied for planning permission to build a huge data storage campus near Bracetown, Co Meath, believed to involve an investment worth “hundreds of millions of euro”.

The company, established last year, was set up by Jason O’Conaill, Eir’s former head of data centres and founder of Amazon Web Services Usergroup Ireland, and Ronan Kneafsey, a former managing director of telecoms and data centres at Eir.

John Magee, partner at DLA Piper in Ireland, said: “It’s no surprise to see Ireland in the top three jurisdictions predicted to see the biggest growth in data centre project investment over the next two years.”

He added: “Ireland has become a strategic global and regional hub for data-rich businesses in sectors such as technology, life sciences and financial services.”

Of the countries examined, Germany is seen by investors as the European nation that will experience the biggest growth in the buildings.

All of the 50 European-based senior executives which were surveyed agreed that uncertainty caused by Brexit had negatively impacted the market for data storage infrastructure in both the UK and the rest of Europe since the June 2016 vote.

One in two investors said that the negative impact had been “significant”.

This is despite the fact that European data centre investment has grown year-on-year since 2016 both in volume and value, according to the report.

They also expect the UK to see some of the biggest investment growth in the industry, despite concerns around Brexit.

Martin Nelson-Jones, partner at DLA Piper, said: “Investment into European data centres has spiked recently, with transaction values reaching a new high.

“Figures for the first half of 2019 suggest strongly that another record year could be in sight. While not without risks, data centres are attractive to many infrastructure investors.”