The data centre industry could be entering a new era of highly specialised real estate demand, according to JLL.

Its Global Real Estate Outlook, global data centre inventory was expected to expand by 20% in 2025. Likewise, their Quantum Computing: Data Centres report has forecast US$10-20 billion in quantum investment by 2030.

With this in mind, Tom Glover, executive director, and head of data centre transactions EMEA at JLL, shared his 2025 insights with Capacity over how AI has driven significant demand for the data centre industry, in addition to challenges and opportunities around power availability and land prices.

Tracking 2025 market growth

The UK data centre market has been in a state of flux for about a year, as its critical national infrastructure classification led to significant interest. This has meant that this year, development supply in London has remained constrained, while the North and Northeast are experiencing rapid growth.

“Across the country, there is extensive speculative provisioning of land for data centre use, although many of these sites remain unproven for deployment,” Glover told Capacity. “This wave of speculation has been driven primarily by the potential of AI demand.”

Significantly, colocation and cloud data centre demand has continued to rise year-on-year. JLL recorded a four-year historic CAGR of 9.8% in London, with a forecast CAGR of 7.9% for 2024-2028.

Overall, the UK market could swell at a CAGR of 30.97% over the next five years.

In line with such booming growth, Glover predicted that AI demand will remain critical to the sector.

“From an investment standpoint, almost everyone wants exposure to the “data centre space,” but only a limited number of investors have real market knowledge or operational experience,” he explained. “While interest is strong, new entrants often slow their approach, or withdraw entirely, once they recognise the complexity of data centre investments.”

He added: “Compared to five years ago, demand is markedly higher, AI is driving accelerated growth, and location options – particularly for certain types of data centres – are no longer constrained to the traditional availability regions around London.”

JLL has projected 20% global data centre inventory growth in 2025 – with 7% growth for London alone, which Glover said “reflects both sustained cloud and enterprise demand as well as the emerging influence of AI workloads”.

Demand driven by AI workloads versus traditional workloads (London):

• 31% from GPU-as-a-Service (AI-related) customers
• 54% from traditional cloud customers
• 14% from traditional cloud customers who are also considering high-density AI workloads

“These figures relate primarily to customer types rather than the exact workloads being deployed, but they demonstrate how AI is becoming a meaningful share of the overall mix,” Glover noted.

Overcoming power and space challenges

The data centre industry is also facing significant power availability challenges, leaving operators to explore a range of power solutions to mitigate grid constraints. This year, there have been standout investments into renewable energy schemes to mitigate these issues, including Amazon’s wind farm investment in Northern Ireland and AtlasEdge securing green financing to expand its data centre campus in Lisbon.

Alongside this, Glover said the industry is actively examining options for on-site power generation, including gas turbines and small modular reactors (SMRs).

“These efforts reflect a shift toward greater energy independence and resilience as power availability becomes a key limiting factor for growth,” he added, having noted that locations with good power capacity and available land are being considered for development.

“Demand is increasingly spreading beyond traditional data centre corridors. AWS has established a micro availability region connecting Didcot, Bracknell and Swindon, while Google has deployed technology to “stretch” its London availability region.

“There is also growing speculation that Microsoft plans to create a new availability region in the Northeast, supported by public notices for two new data centres.”

The road to 2030

JLL’s quantum computing report, published earlier in the year, forecasted $10–20 billion in investment by 2030. The development of quantum data centres could introduce entirely new requirements and risk profiles to the industry.

Glover explained: “Currently, cooling to -273.15°C is necessary for qubits to function reliably over long periods. However, this constraint is expected to lessen or disappear within the next three to five years as quantum technology advances.

“While it’s too early to define exact real estate specifications, it’s clear that power density, specialised cooling and vibration control will all be critical considerations.”

Looking ahead, it’s clear that the UK data centre market will continue to thrive as interest piques. However, significant risks to market growth remain, including power availability, power pricing, land availability and if government support will continue.

“However, perhaps the greatest challenge will be keeping pace with demand amid a sector-wide talent shortage,” Glover said. “But despite these headwinds, the outlook for the UK data centre market remains highly positive, with no slowdown anticipated.”

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