Merlin Properties, the largest REIT in Spain and Portugal, today announced a partnership with Edged Energy, a subsidiary of Endeavour, to build four hyperscale data centers, comprising an initial 80 megawatts of power capacity, in Spain and Portugal. Endeavour is led by Jakob Carnemark, who previously was a founder of U.S. hyperscale data center provider Aligned Energy.

With today’s announcement, Merlin Properties is taking advantage of Spain and Portugal’s increasing importance as connectivity hubs for Europe. Indeed, both countries have robust fiber networks, new subsea cable landings, and significant solar and wind energy resources.

Data Center Development Plan – Merlin Properties

Merlin Properties intends to build four hyperscale data centers in the cities of Madrid, Barcelona, Bilbao, and Lisbon, using sites from its existing land bank. In aggregate, the four facilities will comprise 80 megawatts of power capacity in Phase I. Additionally, the Bilbao and Lisbon sites allow Merlin Properties to scale its power capacity to 240 megawatts, over the long-term.

Below is a break-down of each of Merlin’s data centers by market:

  • Madrid: 20 megawatts of power capacity
  • Barcelona: 20 megawatts of power capacity
  • Bilbao: 20 megawatts of power capacity in Phase I, with total potential power capacity of 100+ megawatts
  • Lisbon: 20 megawatts of power capacity in Phase I, with total potential power capacity of 100+ megawatts

Fiber Connectivity – Initially Challenging

Merlin Properties selected these four sites from their existing land bank, with access to power being a key consideration in their site selection. Therefore, these sites are unlikely to all be located close to key fiber routes, presenting an initial challenge for Merlin.

Overall, Merlin Properties will likely be tasked with investing in their own fiber connections to extend their data center’s connectivity to key interconnection hubs in Spain and Portugal. Importantly, Spain and Portugal are two of the lowest cost markets in Europe to build fiber networks. Therefore, Merlin should be able to develop appropriately-connected facilities in an economic manner.

Data Center Environmental Sustainability

Merlin Properties and Endeavour’s subsidiary Edged Energy, have set ambitious environmental targets for each of the initial four data centers it will build. Specifically, these facilities will:

  • Consume zero water for cooling
  • Have a Power Usage Effectiveness (PUE) of 1.15 annually
  • Use 67% less energy for cooling and overhead systems than average European data centers, which have a PUE of 1.46
Merlin Properties Edged Energy Endeavour Environmental Sustainability
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Overall, the power that each facility consumes will come from local renewable energy sources. Specifically, Merlin intends to source its power primarily from roof-mounted and ground solar panels.

Merlin Properties – Overview

Merlin Properties, the largest REIT in Spain and Portugal, owns a portfolio of commercial real estate in the office, logistics, high-street retail, and shopping center sectors. As of year-end 2020, the company’s 919 assets had a gross asset value (GAV) of €12.8bn. Overall, Merlin Properties’ portfolio has a weighting of 90% towards Spain and 10% to Portugal.

Mary Zhang covers Data Centers for Dgtl Infra, including Equinix (NASDAQ: EQIX), Digital Realty (NYSE: DLR), CyrusOne, CoreSite Realty, QTS Realty, Switch Inc, Iron Mountain (NYSE: IRM), Cyxtera (NASDAQ: CYXT), and many more. Within Data Centers, Mary focuses on the sub-sectors of hyperscale, enterprise / colocation, cloud service providers, and edge computing.

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