Castleforge, an actual property investor that operates in each the workplace and hospitality markets, is ready to enter the info centre marketplace for the primary time, with the agency buying the Redhill Information Centre for a determine in extra of £100 million.
Funded by ICG Actual Property, the acquisition sees Castleforge partnering with Galaxy Information Facilities, a full-service information centre operator and advisory agency.
The Redhill Information Centre campus, situated in Foxboro Enterprise Park, spans round 11,800 sqm (roughly 127,000 sq ft) throughout three buildings and at present gives 26 MVA of energy. Castleforge and Galaxy plan to develop the ability’s capability to fulfill rising demand for digital infrastructure, largely pushed by developments in AI and hybrid cloud computing.
Adam MacLeod, Companion at Castleforge, commented, “Information centres have been a gorgeous prospect that we have now been monitoring for a while, however with developments in AI and cloud computing accelerating demand, we have now been keen to search out the proper alternative through which to take a position. The sector additionally suits inside our speciality of operational actual property funding, and we see this as a logical extension to our current capabilities.
“Redhill Information Centre’s proximity to London means it gives an necessary hub for digital companies that require quick connections to the capital. With no signal of digital innovation slowing down, we felt this was the proper time to make a monetary dedication to the market and consider there will probably be important additional alternatives to return.”
Paul Leong, Chief Monetary Officer at Galaxy Information Facilities, added, “Redhill presents a uncommon alternative to accumulate a high-performing information centre within the prime London market, with strategic potential for enlargement in each energy and scale. We see super development potential to develop the ability’s energy capability and develop Redhill’s buyer relationships. We’re devoted to enhancing the service and expertise for all Redhill’s clients all through this transition and past.”
Dave Misra, Managing Companion at Galaxy Information Facilities, concluded, “Redhill, with its strong 26 MVA capability, is totally outfitted to fulfill clients’ rapid wants. Trying forward, we’re exploring a 10-15 MW build-to-suit enlargement to make sure we will ship the size, density, and energy to fulfill edge, hyperscale and enterprise buyer wants of tomorrow on this quickly evolving digital panorama.”
Flurry of knowledge centre investments
Castleforge is simply the most recent instance of a flurry of buyers getting concerned within the information centre marketplace for the primary time. Solaria, the Spanish vitality agency which is constructing out photo voltaic farms throughout Southern Europe, entered the info centre marketplace for the primary time final 12 months with a brand new facility designed for AI proposed in Spain.
The European information centre market has additionally been a hive of exercise, with CyrusOne saying its entry into the Italian market with its first facility in December 2024, whereas Bain Capital, one of many world’s main funding companies, acquired an 80% stake in Aquila to get a foothold out there. That’s to not point out strikes by Hines and Invesco, each well-known actual property funding companies, who’ve each entered the UK and European information centre markets, respectively, in current months.
It’s unlikely that the extent of funding we’ve seen in current months will probably be slowing down anytime quickly, with Europe estimated to have seen 168% improve in funding throughout the first half of 2024 in comparison with the identical interval in 2023. Huge names reminiscent of Microsoft have already dedicated to spending billions extra on AI information centres, with a lot of that money prone to come to European shores. That’s why it gained’t be stunning to see one other important improve in funding within the first half of 2025 vs final 12 months’s figures.
