With European data centre development continuing to evolve away from its initial real estate focus, the industry will need to embrace further collaboration in order to tackle the major bottlenecks it’s currently facing.

This was the sentiment amongst a panel discussion that took place at NPM‘s 2026 European Development & Finance Forum in Hamburg on May 19.

Hosted by NPM Senior Reporter Ulan Harrison-Davies, the panel focused on the next phase of data centre development and was represented by all corners of the industry including fibre, legal and regulatory, finance and development.

“Ultimately it’s about compute power … [but these GPUs] have to be situated in a room, on a piece of land, it’s got to be powered and it’s got to have connectivity,” said Chief Financial Officer (CFO) of Zayo Europe, Jennifer Smith.

“Fundamentally, you need all of those elements to create value… we don’t have value without each other,” added Smith.

“The system is complicated… it’s a complex game, it’s not just real estate [anymore],” said Chief Executive Officer (CEO) at Greenfield, Fabio Spucches.

Chief Investment Officer (CIO) at Electric Land, Omer Fazal, elaborated on this point, referring to the initial “low hanging fruit” within the data centre market that’s now been swallowed up.

Fazal spoke of how developers or independent power producers (IPPs) wanting to get in on the data centre space a few years back only had to manage a handful of metrics, but now are being forced to look at over 50 different variables to ensure projects are successfully delivered.

Alongside these physical variables, the regulatory requirements are also becoming more complex, said Christian Schindler, Partner at Watson Farley & Williams.

In Germany, incoming changes to power usage effectiveness values were noted by Schindler as a new major consideration for data centre developers.

Providing a financial perspective, Managing Director at Landesbank Baden-Württemberg (LBBW), Christian Felix Munz, said the situation was also complex, however, infrastructure financing is “always complex, and will always be complex.”

“I’d say the top four risk areas [for data centre development] are offtake, construction, delivery and power supply… but there are many more,” added Munz.

Push to locate away from ‘M25-type’ congested zones

The conversation then moved onto zoning challenges, and the increase in interest from developers wanting to site projects further away from congested city centres.

Fazel revealed that he was aware of at least 15 data centre permit applications destined for the outskirts of London outside the M25 orbital motorway, which historically would have been located closer to the centre of the UK’s capital.

“[On the outskirts of cities] there is more land, it’s not as congested and it’s easier to manage the positive and negative externalities that come with data centre development,” added Fazel.

In agreement with the Electric Land CIO, Smith said that she was “already seeing active projects moving away from the M25… [which] is driving technological change in the fibre industry.”

“It’s driving this necessity for us to work together with other [fibre] providers, which hasn’t been present in the industry before,” added Smith, reinforcing the key theme of collaboration amongst the industry – even with competitors.

In terms of other changing industry themes, the panel discussed the increase in availability of powered land platforms – a term which Fazel explained “didn’t even exist two or three years ago.”

“I think there is a lot of opportunity out there,” said Fazel, before saying serious filtration is needed when considering new opportunities, with only 10-20% being feasible ventures for Electric Land as a company.

With such an abundance of opportunities and building upon Fazel’s point, Smith explained that Zayo Europe was having “to say ‘no’ more than [they] did before.”

“We can’t always make it work now because there are so many different variables… there are going to be some projects that just don’t come to fruition,” Smith said.

Spucches put this phenomenon down to some developers not carrying out adequate testing before moving forward with projects, and that only some were prepared to spend money on necessary due diligence.

Financial opportunities of neoclouds and hyperscalers

Moving onto the opportunities presented by neoclouds, Munz explained that although “there are some very well-known names” in this space, lenders are still very wary.

“[The neocloud industry] needs to build totally different financing structures, and we’re not there yet… we wouldn’t do a neocloud financing right now unless it’s backed-up,” said Munz.

In fact, the Managing Director explained that due to the variety and volume of opportunities elsewhere in the AI space, such as with hyperscalers, he wasn’t even considering neoclouds right now.

“The neoclouds don’t want to pay more, but the margins are higher – how can that work?,” said Munz.

When it comes to hyperscaler financing, Munz explained that they usually see projects “structured with five years hard mini-perm on the basis of at least 10+ years lease contracts.”

NPM is tracking over 1250 active data centre projects in Europe, with more being added daily.