This trend, which has seen 415 acres of industrial land across the UK repurposed for data centre use since early 2024, is driven by the surging demand for edge computing, cloud services, and AI applications. This offers a way for warehouse developers and data centre operators to collaborate and unlock new value from existing assets.

The growth of edge data centres

Edge data centres, smaller facilities located closer to end-users, are becoming essential to support low-latency services and decentralised computing. Unlike hyperscalers, which are typically built on remote greenfield sites, edge facilities are situated in urban environments close to population centres, with robust connectivity.

Many existing warehouses in UK cities are ideally located for this purpose, often benefiting from being close to strong utility connections including high-capacity power and fibre infrastructure. Their strategic locations near transport hubs and dense urban populations further enhance their appeal, enabling faster deployment and improved service delivery. Some examples include Gravity Edge and Colt Data Centre Services, both in West London.

The benefits for warehouse developers

For warehouse developers, partnering with data centre operators presents a chance to diversify their portfolios and tap into the high-growth digital infrastructure sector. Refurbishing existing warehouses as data centres can significantly increase rental yields, as they typically command premium rents due to their technical complexity and long-term lease structures.

It also allows developers to future-proof their assets. As demand for traditional warehousing fluctuates, particularly in urban areas where land is scarce and expensive, converting properties into data centres offers a resilient and forward-looking alternative.

What about data centre operators?

For data centre operators, targeting existing warehouse assets provides access to well-located sites with existing infrastructure, reducing the time and cost risks associated with new builds. Collaborating with experienced developers also supports smoother planning and delivery processes, leveraging their expertise in procurement, construction and compliance.

Things to consider

While the potential is significant, refurbishing industrial buildings into data centres requires careful due diligence. Key challenges can include upgrading power capacity, installing advanced cooling systems, ensuring robust watertightness, physical security and cybersecurity measures. Fortunately, warehouses often already possess the structural integrity and utility access needed to support these upgrades.

Environmental sustainability is another critical factor. Data centres are energy-intensive, and urban settings demand thoughtful design to comply with local regulations and maintain ESG targets. Incorporating renewable energy sources, efficient cooling technologies, and green building standards can help mitigate environmental impact and enhance long-term viability. Interesting opportunities to enhance ESG credentials also exist in utilising the waste heat from data centres, for instance, by using it to heat public swimming pools.  

As digital demand continues to grow, the UK’s urban industrial stock offers a valuable resource for expanding edge data centre capacity. By repurposing existing warehouses, developers and operators can respond to market needs quickly and sustainably.

This convergence of logistics and digital infrastructure marks a new chapter in urban property development, one that promises resilience, innovation, and long-term value for all stakeholders involved.

Further information

Contact Roger Bryant and Marc Edmondson

Read our research article on: EMEA data centres here