Commercial property firm CBRE has declared 2012 was a difficult year in the data center space marked by extended negotiations and changing customer requirements.

In its Q412 market overview the commercial property firm’s data center watchers said demand held up with the market conditions described as changeable nevertheless showd Q4 take at its highest quarterly total for three years.

The five major markets reviewed are London, Franfurt, paris, Amsterdam and Madrid.

The Q412 figures listed stock at 707,000 sq m, supply of 648,600sq m. European colocation supply rose by ‘an exceptional’ 106MW in 2012 the report said. Cloud computing was responsible for a 12% rise in take up of European colocation space.

Amsterdam showed record take up, wholesale take up in London was also at record levels.

“2012 has proven to be a difficult year for business confidence with four of the five cities under review in this report experiencing recessionary periods.  Heightened occupier caution towards new spending resulted from the unease although the tone in the market remained positive. The unsettled economic environment has led to unpredictable new demand  and transaction levels. Extended negotiation periods and changing customer requirements have become more common, although in general demand levels have held up well. The final quarter of the year illustrated the changeable market conditions where take-up was the highest quarterly total for three years following two quarters of slower activity.”

Colocation take-up showed a 12.1% increase compared to 2011. The technology sector has again been the driving force behind new demand with organic growth of new and established companies requiring data centre support.

London and Paris also saw improvement in transaction totals with London’s wholesalers in particular seeing strong activity. Total take-up of wholesale space in London was the highest recorded, more than double that of 2011.

Sharp rise in new supply
Reflecting growing market confidence, 2012 saw the highest annual rise in data centre supply on record. Continuing expansion plans brought about an exceptional rise in power capacity with 106MW added in 2012. The associated physical space rose by 10.7%, the largest increase since before the credit crisis of 2008.

Amsterdam has been the main point of focus where operators have been quick to respond to rising demand. Several of the main operators have brought on new capacity during the year including Equinix AMS 3, Telecity AMS 5, Interxion 6 and Evoswitch Hall 6.CBRE expects further expansion given a vacancy rate of 13% amid continued demand.

In Frankfurt, e-shelter’s Russelsheim facility was the most anticipated opening in 2012 adding 4,500 m² of space to the market. Interxion and Equinix both opened new facilities in Paris where supply rose by 11.7%. In London, Europe’s biggest market, a rise of 10.9% was recorded with new schemes by Infinity, Digital Realty and Telecity being the largest.

The report