Europe Data Center Colocation Industry Analysis Report, Regional Outlook, Growth Potential, Price Trends, Competitive Market Share & Forecast 2026-2031
CHICAGO, July 15, 2026 /PRNewswire/ -- According to recent research by Arizton, the Europe data center colocation market by investment was valued at USD 11.65 billion in 2025 and is expected to reach USD 46.51 billion by 2031, growing at a CAGR of 25.94%. Western Europe is expected to account for approximately USD 33.17 billion, representing 71.3% of overall European investment by 2031, followed by the Nordics at 22.8% and Central & Eastern Europe at 5.9%. The market is expanding as AI and cloud workloads increase infrastructure requirements, while digitalization, 5G deployment, sustainability initiatives, and submarine cable investments support the next phase of data center development across Europe.
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Browse in-depth TOC on the Europe Data Center Colocation Market
Pages- 483
Region- 3
Countries- 20
Company- 183
Segment-9
Europe Data Center Colocation Market Snapshot
Market Size by Investment 2031 | USD 46.51 Billion |
Market Size by Investment 2025 | USD 11.65 Billion |
CAGR - Investment (2025-2031) | 25.94 % |
Market Size - Colocation Revenue 2031 | USD 43.45 Billion |
Market Size Area (2031) | 12.79 Million sq. feet |
Power Capacity (2031) | 3,391 MW |
Base Year | 2025 |
Forecast Year | 2026-2031 |
Market Segments Covered | Colocation Service, Infrastructure, Electrical Infrastructure, Mechanical Infrastructure, Cooling Systems, Cooling Techniques, General Construction, Tier Standards, and Geography |
Geographical Analysis | Western Europe, Nordic, and Central & Eastern European Countries |
Europe's Data Center Investment Is Shifting Beyond Established Hubs
The UK and Germany captured 19.59% and 13.74% of European data center investment in 2025, keeping a significant share of capital concentrated in Europe's two largest markets.
The entry of Ada Infrastructure, Compass Datacenters, DAMAC Digital, DayOne, and Prime Data Centers is widening the European colocation operator base and expanding the pipeline of new data center developments.
Power, land, and sustainability restrictions in Amsterdam are adding new constraints to data center development, increasing the importance of alternative locations for future capacity.
Italy's development pipeline includes approximately USD 8.13 billion across two major announced investments, the Trino site redevelopment and three EdgeConneX campuses in Lombardy, signaling a significant increase in the scale of planned capacity.
The planned USD 2 billion AI-ready data center near Helsinki highlights the Nordics' growing role in accommodating power-intensive AI infrastructure, supported by access to renewable energy.
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Higher Rack Power Densities Shift European Data Centers Toward Liquid Cooling
In Europe, data centers are increasingly adopting liquid cooling technologies as traditional air-based cooling systems face growing pressure from high-performance computing (HPC), AI workloads, and rising rack power densities. To improve thermal management and energy efficiency in these high-density environments, operators are turning to two key approaches: direct-to-chip liquid cooling, which circulates coolant directly to heat-generating components such as CPUs and GPUs, and immersion cooling, which submerges computing components in a non-conductive liquid to remove heat efficiently. Growing heat loads from AI and HPC deployments are therefore expected to increase investment in advanced liquid cooling technologies across European data centers during the forecast period.
AI Adoption Expands the Need for AI-Ready Data Center Infrastructure Across Europe
AI adoption is expanding across Europe as businesses, governments, and research institutions increase investment in AI technologies and supporting digital infrastructure. The Netherlands, which ranked fourth globally in the Government AI Readiness Index 2025, has 95% of organizations running AI programs, while Ireland's updated National AI Strategy includes actions related to digital infrastructure and data center development. The growing deployment of AI and high-performance computing workloads is increasing the need for computing capacity, power infrastructure, and high-density data center environments, strengthening the investment outlook for AI-ready data center infrastructure across Europe.
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Europe Data Center Colocation Market Segmentation Insights
Europe Colocation Revenue: The Europe data center colocation market is expected to more than double by 2031, supported by cloud adoption, hyperscale expansion, AI workloads, and enterprise IT outsourcing.
Electrical Infrastructure: Electrical infrastructure accounts for a significant share of investments owing to the growing deployment of high-density racks and AI-ready infrastructure. The segment is expected to grow at a significant CAGR during the forecast period.
Mechanical Infrastructure: The fastest-growing segment is expected to see a sharp increase in investment, driven by liquid cooling, direct-to-chip cooling, and other advanced cooling technologies.
General Construction: Investment is forecast to grow substantially, supported by greenfield projects, modular construction, and multi-building data center campuses.
Retail Colocation: Revenue is expected to maintain steady growth, supported by demand for carrier-neutral facilities, hybrid cloud deployments, and managed colocation services.
What Key Findings Will Our Research Analysis Reveal?
- How big is the Europe data center colocation market?
- What is the growth rate of the Europe data center colocation market?
- What are the key trends in the Europe data center colocation market?
- How much MW of power capacity is expected to reach the Europe data center colocation market by 2031?
- What is the estimated market size in terms of area in the Europe data center colocation market by 2031?
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Source: Arizton Advisory & Intelligence
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