Data Centers as an Investment

Global demand for computing power is growing at a rate that has no historical precedent. Behind every request to an AI model, behind every real-time transaction, behind every GB of data transferred through the cloud, there is physical infrastructure inside a data center. That infrastructure has value and its value is rising.

In this series, Layer 1 Technologies examines the data center sector as an investment asset class, across three levels of analysis and three different scales of capital deployment:

This article examines the macro-investment framework: why data centers have become the new infrastructure category claiming a place alongside airports and motorways, how the value creation mechanism works, who the key players are, and what all of this means for investors of different scales.

The second article goes one level deeper: investment in Micro, Modular and Edge Data Centers of 0.5–2 MW capacity — the most accessible form of direct exposure to physical infrastructure for entrepreneurs and companies seeking new opportunities. With real CAPEX, OPEX, IRR figures and exit strategies.

The third article examines a higher-return strategy: developing GPU infrastructure and leasing it through AI marketplaces such as FluidStack and Vast.ai. It analyses the GPUaaS model with real numbers, addresses the risk of technological obsolescence, and proposes a strategic approach.

All three articles are connected by a single principle: the quality of the physical layer, the infrastructure that is invisible but determines everything, is what separates a successful investment from one that exists only on paper.

The Macroeconomic Context

The global data center market is experiencing what analysts call a supercycle, a wave of investment without historical precedent. The numbers speak for themselves:

• Global capacity is expected to double by 2030, adding ~100 GW of new power
• Required investment is estimated at $3 trillion by the end of the decade
• Existing data centers worldwide are operating at 97% utilization
• In 2025, mergers and acquisitions in the sector exceeded $69 billion

Data centers are no longer a niche technology investment. They have become infrastructure — in the sense that large capital pools understand the word: long-term cash flows, strong entry barriers, and critical importance to the functioning of the economy.

Three forces are driving this shift simultaneously:

• Structural change. The transition to cloud-native architectures is irreversible. The majority of large companies will never build their own data center again, they will buy computing power as a service, just as they buy electricity. This generates demand that is not cyclical but structural.
• Artificial Intelligence. Training a large language model consumes energy equivalent to that of thousands of homes for an entire year. And that is only the training phase, every query a user sends, every automated decision made in real time, requires continuous, geographically distributed computing power.
• Regulatory compliance. Frameworks such as GDPR in Europe and equivalent regulations in Asia and North America mandate local data storage and processing. Every country, every region, needs its own physical infrastructure. Geographic decentralisation is not a strategic choice — it is a legal obligation.

What Makes a Data Center a Compelling Investment

Unlike equities or cryptocurrencies, a data center generates cash flows with the characteristics of a government bond. Contracts are structured as triple-net leases (NNN: Net Taxes, Net Insurance, Net Maintenance) with terms of 10–15 years: the tenant assumes operating expenses, energy is billed separately, and rent increases are linked to inflation indices.

The key characteristics of the asset class:

• Exceptionally low churn rate. In a commercial property, a tenant who dislikes market conditions simply leaves. In a wholesale data center, a hyperscaler that has installed 10 megawatts of equipment — thousands of servers, kilometres of cabling — does not leave. Physically relocating that infrastructure costs tens of millions and takes months. As a result, the churn rate in wholesale data centers consistently approaches 0–2%, a figure unimaginable in any other real estate category.
• High entry barriers. Building, power, cooling, security, certifications. Permitting and constructing a data center takes years and deep technical expertise. This protects existing operators. Beyond that, grid capacity is not unlimited: in the Dublin area, the relevant regulatory authority has effectively frozen new connection licences. Whoever has already secured power holds a resource that cannot easily be replicated.
• A deep pool of exit buyers. Infrastructure-focused investment funds (Macquarie, Meridiam), sovereign wealth funds such as the Norwegian Government Pension Fund, private equity firms (Blackstone, EQT), and listed REITs (Equinix, Digital Realty) all compete for high-quality assets.
• Inflation-linked income. Rents are renewed with CPI (Consumer Price Index) escalation clauses. In an inflationary environment, this is a meaningful advantage over fixed-yield instruments.

At a time when the average global M&A multiple across all sectors stands at 9.3x EBITDA, data centers trade at 15x to 30x+ depending on the category (wholesale/retail colocation, edge, etc.).

These multiples are expected to remain elevated due to structural supply scarcity. The data supports this view: with existing facility utilisation at 97% globally, owners hold unprecedented pricing power over tenants.

The Investment Spectrum

There is no single entry point. The market offers levels for every investor profile:

Level 1 — Indirect Exposure

Purchasing shares or ETFs in listed Real Estate Investment Trusts (REITs) such as Equinix and Digital Realty. Data center REITs trade at multiples of 25x+ on operating cash flows, reflecting market confidence. Low investment complexity, immediate liquidity, but no ability to exert control. Outside the scope of both this article series and Layer 1’s services overall.

Level 2 — Micro & Modular Data Centers (€300,000 – €3 million)

Investment in prefabricated modular infrastructure and containers of 0.5–1 MW capacity, manufactured in a factory and deployed in 3–6 months. The most accessible form of direct investment in physical infrastructure, ideal for entrepreneurs and companies seeking portfolio diversification. Covered in depth in the second article of this series.

Level 3 — GPU Infrastructure / AI Compute (€500,000 – €5 million)

Beyond the data center build itself, acquisition of GPU hardware and leasing it through marketplaces (FluidStack, Vast.ai). Higher potential returns, but also higher risk of technological obsolescence — the NVIDIA upgrade cycle replaces generations every 12–18 months, and the timing of purchase and sale is as critical as the yield model itself. Covered in detail in the third article of this series.

Level 4 — Wholesale / Hyperscale Development (€20 million+)

Development of 5–50+ MW facilities for hyperscalers (AWS, Google, Microsoft) or large enterprises. Requires a specialist data center facility operator, deep permitting expertise and a strong balance sheet. The category with the highest absolute returns — and the longest time horizon.

Greece: An Opportunity with Prerequisites

In an international environment where the traditional European hubs (FLAP-D: Frankfurt, London, Amsterdam, Paris, Dublin) face historically low vacancy rates and regulatory pressure, Southern Europe is emerging as the next investment frontier.

Greece holds fundamental advantages:

• Geographic position as a crossroads, including an energy one, between Europe, Asia and Africa
• Rapidly developing subsea cable infrastructure
• Lower land costs relative to Western Europe

Like any emerging market, the Greek market has its particularities: permitting can take time, grid access requires planning, and the supply chain for specialised equipment is still maturing. These are not obstacles, they are parameters that a well-prepared investor, with the right partners, can manage effectively.

A Market That Is Not Waiting

In 2015, few European investors took data centers seriously. They were considered niche, technically complex and difficult to evaluate. A decade later, those same assets represent the most competitive infrastructure capital globally.

The market cannot yet be considered mature, least of all in Greece, but it is maturing fast, and entry prices are no longer what they were in the recent past. Returns on infrastructure developed before tenants are secured are not guaranteed, and the quality of the physical infrastructure behind every number in a data center project determines, to a large extent, whether it delivers or fails.

Layer 1 Technologies operates at precisely that layer, the physical infrastructure that makes every investment strategy described above possible. In the next two articles in this series, we examine two specific entry strategies with real numbers: Modular Data Centers and investment in GPU infrastructure through AI marketplaces.

This analysis is provided for informational purposes only and does not constitute investment advice. Layer 1 Technologies provides specialised solutions in data center, critical power and telecommunications infrastructure. For an initial discussion about your investment strategy in the sector, contact us.