BlackRock commits €578m to UK data centre upgrades

BlackRock is investing up to £500 mln (€578 mln) through its real estate business to upgrade enterprise data centres across the UK. 

Data centre

This initiative aims to meet the growing demand from businesses for advanced data processing capabilities, especially for AI and digital transformation.
The investment will be managed by a new joint venture called Gravity Edge, formed by BlackRock and Digital Gravity Partners (DGP). 
Gravity Edge will focus on acquiring, expanding, and modernizing data centres in key UK markets where power supply has been limited. These upgraded 5-20 MW data centres will offer higher-density racks, reliable power, advanced cooling, and fast connectivity for enterprise clients.
Gravity Edge has already acquired an enterprise data centre west of London for over £100 million. This facility, already serving a major financial services tenant, has the potential to expand significantly and will be modernized to improve efficiency and accommodate high-density computing needs. 
The London area is a crucial market for data centres, with demand expected to grow substantially by 300MW (+30%) by 2028, according to research and analysis by EY-Parthenon.
Thomas Mueller-Borja, global co-head of Real Estate at BlackRock, said: “Investing in the critical real estate that underpins our economies is essential for accelerating the digital transition. With capital markets largely focused on the hyperscaler end of the market, enterprise data centres play a crucial role in boosting overall compute capacity and serving UK plc with more sophisticated digital capabilities. With the launch of our investment programme, we are enabling our clients to access new opportunities across the data centre value chain and unlocking capital for what we believe will be a transformational platform in the data centre market together with our experienced partners at DGP.”
Thor Johnsen, managing partner at DGP, added: “We are thrilled to partner with BlackRock in building out this data centre platform in the UK, which has the potential to scale across select sites in Europe. Gravity Edge currently delivers mission-critical data centre services to a Tier 1 financial institution at an exceptionally well-run site. We plan to further modernise the facility, enhancing energy efficiency, enabling higher rack density, and unlocking additional sellable capacity. Our shared vision is to establish Gravity Edge as the default choice for customers requiring high-performance, mission-critical infrastructure, with operations designed for modern enterprise use cases in proximity to major urban hubs.”
BlackRock is funding this data centre investment through its main European value-add real estate fund. This fund focuses on recapitalizing, repositioning, and rebuilding real estate assets across Europe, with existing investments in countries like the UK, France, Germany, the Nordics, and Spain.