Data Centers Spur European Logistics Space Demand

The insatiable demand for digital infrastructure is creating a significant, often overlooked, ripple effect across Europe's industrial real estate sector. Analysis from real estate advisory firm Savills projects that the expansion of data center operations across the continent will necessitate an additional 8.462 million square feet of logistics space within the next three years. This surge is driven by the critical supply chain needs of data center operators and their supporting industries.

Evidence of this trend is already apparent in key European markets. In Dublin, for instance, companies integral to the data center ecosystem accounted for a substantial 10 percent of all logistics space leased in 2025, equating to 225,000 square feet. Furthermore, an additional 500,000 square feet are currently in the pipeline for this sector in the Irish capital, underscoring the direct correlation between digital infrastructure growth and warehousing requirements.

Savills' research quantifies this relationship by estimating that each megawatt of data center capacity requires between 7,250 and 10,560 square feet of associated logistics space. With Europe's live data center capacity standing at 10.9 GW and another 2 GW under construction, the demand for supporting facilities is set to escalate dramatically. This is particularly pronounced in the FLAPD markets (Frankfurt, London, Amsterdam, Paris, and Dublin), which are collectively developing 950 MW of new data center capacity.

Kevin Mofid, Head of EMEA Logistics Research at Savills, highlighted the underappreciated impact on the logistics market. "While much of the discourse surrounding data center expansion centers on land acquisition and power supply, the consequential demand on logistics facilities has received scant attention," Mofid stated. "Our early-stage analysis reveals that in regions experiencing rapid data center development, we are observing an increasing number of data center suppliers seeking traditional logistics warehousing."

The implications extend beyond mere square footage. The need for specialized storage and distribution for components, cooling systems, power distribution units, and other essential hardware is driving this demand. This is not a localized phenomenon; the UK has already seen a significant lease agreement where AVK SEG, a firm specializing in data center power solutions and AI infrastructure, secured 140,000 square feet of logistics space in the North West of England. This move by AVK SEG exemplifies the growing requirement for strategically located facilities to support the complex operational needs of the digital infrastructure sector.

This trend mirrors developments in other regions, with logistics providers like DHL actively expanding their warehouse footprints in the US specifically to cater to the burgeoning data center industry. As Europe continues its digital transformation, the synergy between data center development and the logistics sector is set to become an increasingly important factor in industrial real estate strategies across the continent.