London, UK: Europe has become the costliest place on the planet to build the data centres that power artificial intelligence, and the bill is still climbing. That is the verdict of the 10th edition of Turner & Townsend’s Data Centre Construction Cost Index (DCCI), the leading global benchmark for what it takes to put a data centre in the ground.
The index draws on over 500 live or recently completed projects in 62 markets, backed by a survey of more than 400 industry experts. Across Europe, costs rose by 13% to around €10.97 per watt, the steepest year-on-year rise anywhere in the world. Zurich ranks third globally at roughly €13.70 per watt, behind only Tokyo (about €15.72) and Osaka. Four Nordic capitals sit in the global top ten: Copenhagen (about €12.39), Oslo (€12.00), Stockholm (€11.97) and Helsinki (€11.46). Paris, London, Berlin, Amsterdam and Dublin all make the top 20, at between about €10.84 and €11.28. In total, 18 European locations feature in the index.
The culprit is people. Just 19% of European respondents believe contractor capacity is manageable, against 52% globally.
Niall O’Reilly, Director and Data Centre lead for Europe at Turner & Townsend, said: “Europe is seeing strong demand for new, next-generation data centre projects and many of the most attractive locations, such as Scandinavia, benefit from the affordable, renewable power and cooler climates which are well suited to higher density designs.” He warned that demand is outrunning contractors, and pointed to rising activity in Hungary, Bulgaria, Slovenia and Greece. The European Union is also seeking over €30bn in public-private co-financing for AI gigafactories, yet “it is clear that in a global race driven by AI, Europe is facing a major skills shortage and risks losing out to international competitors on the technical expertise and leadership experience needed to deliver major data centre projects.”
The pressure is global. Construction costs rose worldwide in 2026 as AI demand outpaced the supply of powered land and skilled labour. Power is the sharpest bottleneck: 56% of respondents call it a major obstacle, 52% say utility connections take one to two years, and 32% say more than two years. Some relief may be coming, with 28% of global respondents expecting inflation of 1% to 5% in 2027. Yet 52% expect most of their 2027 projects to be AI data centres. At the other end of the scale, Shanghai (about €4.98) and Mumbai (about €5.87) are the cheapest markets in the index.
Paul Barry, Data Centre Construction Cost Index Lead at Turner & Townsend, said annual capital expenditure on data centres has reached around €690bn, rising to about €1.55 trillion by 2050 according to PwC’s global AI infrastructure report. He added: “Data centres are also subject to increasing scrutiny, with political and community consent essential to delivery.” He said larger, more complex projects carry a premium, because “the shortage of skilled labour and the greater risks involved in the delivery of larger, more complex projects is driving a cost premium.”
What the headline numbers leave out is the spread inside Europe itself. On the index’s typical 60 MW design, our own calculation puts a Zurich build at roughly €822m, against about €553m in Warsaw (about €9.22 per watt), a gap of around a third. For investors and developers, the opportunity may lie in secondary markets where costs are lower, while the real risk is the time and cost of securing power connections and skilled contractors, not the price per watt alone.
People mentioned
- Niall O’Reilly, Director and Data Centre lead for Europe, Turner & Townsend
- Paul Barry, Data Centre Construction Cost Index Lead, Turner & Townsend
Companies mentioned
- Turner & Townsend: global programme management company and publisher of the Data Centre Construction Cost Index
- CBRE Group: majority owner of Turner & Townsend
- PwC: publisher of the global AI infrastructure report cited for data centre investment forecasts
Image Source: Photo by Geoffrey Moffett on Unsplash
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