EUR60mn Realty Bite For Bouygues' Data Centres

Digital Realty Trust Inc , a US-based global provider of datacentre facilities, has acquired a three-p r operty datacentre portfolio in the Paris area from Bouygues Télé com , France's third-largest telecommunications operat or. The move helps Bouygues Télé com cut its growing operating costs and benefit from Digital Realty's expertise in securing third-party customers that can take up underutilised capacity on servers located in the facilities. It also highlights Digital Realty's ambitious international growth strategy in the fast-growing datacentre market.

Digital Realty paid EUR60mn for the properties, but will see an immediate return on that investment as Bouygues leases back capacity in the properties, which it will continue to maintain and operate. The portfolio consists of one Tier III+ facility at Montigny-le-Bretonneux and two Tier III facilities in Bievres and Saclay. The properties total approximately 87,000 rentable square feet, with nearly 5MW of IT capacity.

Growing Importance Of Cloud In Datacentre Market
Global Datacentre Traffic (EB per year)

Having acquired similarly scaled properties in London in July 2012, Digital Realty is increasing its exposure to the datacentre market in Western Europe. The company is targeting markets with large and fast-growing enterprise communications requirements and where there are top - tier telecommunications and IT partners. It is also acquiring properties managed and operated by large private-sector organisations in the healthcare, financial services and manufacturing industries and currently owns 110 properties worldwide with approximately 21.2mn square feet of capacity. Digital Realty ' s portfolio is located in 32 markets throughout Europe, North America, Asia and Australia.

Although its core business lies in the provision of mobile telephony and fixed broadband and telephony services in France, Bouygues Télécom is looking to grow its enterprise services business and is investing heavily in infrastructure and technology that will help it deliver networking, IT solutions and cloud computing services to customers of all sizes. However, that investment has been jeopardised by the arrival of a fourth mobile network operator in France, as well as the growing influence of low-cost mobile virtual network operators (MVNOs), which has seen revenue drain away from the company and peers such as Orange and SFR . Reducing its property ownership costs is but one step in helping it make vitally needed savings, but is welcome all the same.

Digital Realty's global expansion initiative is driven by the recognition that enterprises are putting greater reliance on datacentres for their data storage, processing and retrieval needs. Cisco Systems forecasts that cloud datacentre traffic will grow from 1,181 exabytes (EB) in 2012 to 4,255EB in 2016, while traditional datacentre traffic will grow at a muted pace, from 1,370EB in 2012 to 2,394EB in 2017.

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Geography: France

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