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Data Storage

Self-storage and data centres attracting real estate investors – says JLL

Self-storage and data centres draw investors as they look for asset diversification and risk-adjusted returns.

In a year rocked by uncertainty, investors are turning to alternative assets like self-storage data centres as they look to enhance their returns during a risky year.

According to a recent article by JLL, the data centre market around the work is changing due to urbanisation, expanding consumer markets, household wealth, and technological developments.

With the proliferation of technology, niche property types around the globe is growing.

These niche property types, like self-storage and data centres, says JLL, is growing and leading the way with significant levels of institutional investment. JLL’s recent transparency study backs it up with another 54 countries reporting at least institutional investment in these property types.

There is a strong correlation between the increased investment and increased transparency, says Matthew McAuley, Director, Global Research at JLL.

Investor activity in these niche sectors and improved transparency tend to be self-reinforcing,” he says. “Investor interest drives a greater need for market information, while enhanced transparency allows investors to understand and thus allocate capital to these property types.”

“Among the 12 niche sectors included in The Global Real Estate Transparency Index 2020 report, cold storage, self-storage, life sciences, medical office, and data centres have seen the most growth in interest. Cold storage in the Asia-Pacific region is growing especially fast, while global investment in self-storage rose to US$6.4 billion in 2019, from less than US$500 million a decade earlier,” says JLL.

UK and the States lead as the world’s most transparent markets, where data providers have also been active. “While some sectors have taken a hit from COVID-19, experts expect interest to continue, bolstered by global megatrends like housing affordability, ageing populations and increasing reliance on technology,” says the property consultant.

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