Invesco Real Estate acquired its first data centre asset in Europe, a 22,300m2 facility in Wissous, a few km south of the Paris ring road. The acquisition has been made on behalf of one of Invesco’s long-standing separate accounts. ARGAN is selling the site.
The facility, recently refurbished by ARGAN and CyrusOne, benefits from a long lease to CyrusOne, one of the largest data centre operators in the world. The facility will ultimately deliver a total IT capacity of 27 MW across six data halls.
Demand for data centre space in Europe outstripped supply in 2023. The imbalance was largely driven by FLAPD (Frankfurt, London, Amsterdam, Paris, and Dublin) markets. Industry forecasts predict rental rates to grow at double-digit rates year-on-year for the next five years.
Paris has grown to become one of the largest data centre markets in Europe and one with the fastest growth within the FLAPD group. The city, which benefits from world-class digital infrastructure with a quality domestic fibre network and reliable connectivity with low latency, also has Europe’s most competitive and stable power prices and a resilient electricity grid with a low-carbon electricity mix.
Alexandre Rochet, Director – Investments, France at Invesco Real Estate said: “This will be our first data centre investment in Europe. It combines long-term income with a captive tenant in a strongly undersupplied market. Data centres are one of our conviction investment themes with strong market fundamentals, high barriers to the development of new supply and continuously growing demand, driven by broad migration to the cloud, Artificial Intelligence and the transition to a fully digitized economy. The asset is a former courier platform and can be easily converted to its original logistics use. The building characteristics and its direct environment were a key factor in our investment decision as the asset sits in one of the best submarkets of Paris for last mile logistics, adjacent to Orly airport, and therefore fully reversible.”
Toby Simon, Managing Director and co-head of Separate Mandate Accounts at Invesco Real Estate said: “We are delighted to be able to secure the 3rd investment for our long-standing client within 2024, not only allowing to place capital at a time when asset pricing has returned to very attractive levels but also securing future-proof income with long-term value growth potential in an irreplaceable location.”
Image source - Invesco.
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