Data centres research paper

'Data centres: Navigating a fluid asset class' is the first paper of a new research on data centres. INREV highlights the strong structural tailwinds driving interest in the sector, assesses the challenges investors face in accessing this opportunity, and seeks to forewarn the industry about the risks. 

Key highlights: 

• Data centres are a fluid asset class, combining real estate, infrastructure and private equity characteristics. They attract a diverse range of investors, often regardless of asset class categorisation.
• Investment approaches depend on strategy, targeted lifecycle stage, and investor capabilities and preferences, ranging from powered land and development to stabilised core assets and operating platforms.
• Data centres present risks not typically found in traditional property, including power and infrastructure constraints, tenant and technology risks, planning and sustainability considerations, and concentration, liquidity and exit risks.
• Specialist expertise is critical. Investors must assess whether they have the capabilities to invest directly or whether partnering with specialist managers, developers or operators offers a more effective route to market.

The paper draws on in-depth expert interviews with investors, fund managers, developers, and operators representing a combined global alternative assets AUM of over €1 trillion.