Research from construction and property management consultant, Rider Levett Bucknall (RLB) finds that while demand for data centres is rising faster than expected, supply chain constraints are creating significant challenges.
More than 70% of respondents to its survey of the sector believe the supply chain is struggling to keep pace, and 53% fear that the sector will be unable to meet capacity demands.
RLB’s Data Centre Trends report interviewed 535 executives across data centre operators and contractors in the UK and Europe between December 2024 and January 2025. The results indicate that while fewer respondents see supply chain risks increasing compared to last year, prices continue to climb and the chasm between demand and supply is widening.
Commissioned capacity has surged by nearly 300% since 2023 with operators averaging 47MW each this year. RLB found that 63% see the influx of private equity investment intensifying demand for data centre materials and infrastructure.
The market for data centre retrofits is also expanding, with 66% of respondents planning to retrofit at least a quarter of their estates in the next five years.
The growth of artificial intelligence is driving soaring demand for energy, power density and liquid cooling; 73% of respondents say power density requirements from data centre occupants are increasing. A similar number expect small modular reactors (SMRs) to become a widespread power source for data centres in Europe in the next 15 years.
Nikki Venetsanakis, RLB’s head of advanced tech, said: “With demand growing faster than expected, delivering projects on time and within budget requires a strategic, proactive planning approach. Innovation and collaboration – particularly through early supplier engagement – will be key to ensure scalable, sustainable infrastructure for the future.”
The biggest constraint on the data centre supply chain is for general contractors, the report says, as supply has not kept up with demand. “Construction can be a slow-moving industry and it takes a while to build capacity or transfer it from another sector,” says Ross Baylis, vice president of data centre operator Stack Infrastructure. “As the market evolves, capacity will grow.”
The data centre sector is in particular need of general contractors specialising in mechanical & electrical construction, he adds, but the European market has traditionally been dominated by civil or structural contractors.
Adding to developers’ worries are concerns about the financial sustainability of the few contractors capable of delivering data centres at scale. The collapse of ISG in September 2024 was a wake-up call for the industry, the report says.
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