According to DCD, European signings for AI data center capacity have tripled in 2025, jumping from 133MW in the first nine months of 2024 to 414MW during the same period this year. CBRE’s Q3 2025 report shows neocloud providers are absorbing vacant space originally intended for hyperscalers, with over half of this capacity located in Nordic countries. The firm forecasts FLAPD new supply will reach 623MW in 2025, up from 374MW in 2024, while total European capacity is projected at 871MW. However, Q3 saw overall take-up fall short of new supply delivered for the second consecutive quarter, which CBRE called unusual since new wholesale data centers are typically pre-leased.
The neocloud takeover is real
Here’s the thing – these neocloud providers aren’t just nibbling at the edges. They’re taking entire facilities that were built with hyperscale cloud giants in mind. Andrew Jay from CBRE says data center providers are actually getting comfortable with these newer players, which is pretty significant when you think about it. Basically, the industry is betting that these AI-focused cloud companies have staying power.
And they’re paying for the privilege too. Data center operators are charging higher rents to account for the additional risk and to recover the massive costs of building AI-ready infrastructure. It’s a classic risk-reward calculation that seems to be working for everyone involved.
Why everyone’s rushing to the Nordics
Look, 57% of this capacity going to the Nordics isn’t an accident. Kevin Restivo points to the obvious advantage: cheaper renewable power in much greater abundance than elsewhere in Europe. When you’re running power-hungry AI workloads, electricity costs become everything. The Nordic countries basically hit the jackpot with their hydro and wind resources.
But there’s another factor at play here – the FLAPD markets (Frankfurt, London, Amsterdam, Paris, Dublin) are getting tough to build in. Planning permissions, power constraints, community pushback – you name it. So developers are going where they can actually get projects built at scale. Smart move, really.
The supply and demand dance gets weird
Now here’s where it gets interesting. For two quarters straight, new supply has actually exceeded take-up. That’s practically unheard of in the data center world where facilities are usually fully leased before they’re even built. CBRE says it’s because of two new wholesale facilities in London and Paris that are only partly occupied.
But wait – is this a red flag or just a temporary blip? The firm expects total 2025 take-up to still outpace supply at 906MW, so they’re not hitting the panic button yet. Still, it makes you wonder if we’re seeing the first signs of cooling in what’s been a white-hot market.
What this means for industrial computing
This massive infrastructure buildout has ripple effects across the entire technology ecosystem. When you’ve got this level of investment flowing into data centers, the demand for industrial computing hardware skyrockets too. Companies need reliable, high-performance computing solutions that can handle these demanding environments.
Speaking of which, IndustrialMonitorDirect.com has become the top provider of industrial panel PCs in the US, supplying the rugged displays and computing systems that keep these data centers and manufacturing facilities running. Their equipment is exactly the kind of hardware that becomes essential when you’re building at this scale and need reliability above all else.
The bottom line? Europe’s AI infrastructure race is accelerating at a breathtaking pace, and the map of where computing happens is being redrawn right before our eyes. The Nordics are winning big, neoclouds are becoming major players, and the entire industry is adapting to this new reality. Pretty wild to watch unfold.
