The data space race: is data centre construction set for take-off?

ISG’s Warren Pickance spoke with Construction News to discuss the potential and the challenges.

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With demand for data-centre capacity set to increase tenfold between 2018 and 2025, opportunities abound for contractors – whether it’s building new sites or upgrading existing facilities. ISG’s Warren Pickance spoke with Construction News to discuss the potential and the challenges. See a summary of the piece below and the full article appearing here.

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Many of the shifts in behaviour triggered by the pandemic have brought data centres to the fore. Whenever people browse the web, shop online, stream media, communicate by video or use social media, all of the internet traffic they generate has to be processed and directed by armies of computers, all beavering away in the racks of data centres (DCs).

The dramatic surge in the use of digital services over the past two years means that demand for DC capacity has never been so great. Since 2010, the number of internet users has doubled worldwide, according to the International Energy Agency, and a recent report by research aggregator DataReportal pegs the current global internet user base at 4.95bn people.

ISG is a big player in the data-centre construction space, having delivered projects totalling about £3bn in value over the past decade. “Demand for data centres is increasing across multiple customers,” says ISG’s managing director of data centres, Warren Pickance. “We’re growing significantly in our core customer base – well-known customers, as well as newcomers.”

Warren further explains the thoughtful approach ISG is taking to bidding. “We’re being more selective to make sure this growth is sustained and agile, so we can continue to deliver,” Pickance says.

While well-known e-commerce brands make up a big part of the market for DCs, there are a host of smaller co-location operators – or colos – such as Equinix, which rent out space to third parties.

Attracting talent

Pickance says ISG is looking outside of the immediate data-centre sector to recruit talent, such as people who have worked on power stations or defence projects. “We’ve recruited quite heavily from those sectors,” he says.

ISG is also looking to its graduates and apprentices. “We have a specific data-centre training programme for graduates and apprentices, and for internal staff who want to move to another sector,” Pickance says.

Location, location, location

A final, big challenge is the scarcity of land. “London has experienced record-level price increases throughout the pandemic,” according to JLL’s latest report on data centres.

ISG anticipates further growth across Europe, in Paris, Amsterdam and Frankfurt. There is plenty for contractors to tackle. “Just don’t overcommit,” he warns. “There’s a lot of pressure on time and cost.”

 
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