Sustainable processing power for regional enterprises

Market researchers predict that global data volumes are set to triple worldwide by 2025. Only Germany seems to be reluctant to join in so far, since the necessary infrastructure is still missing here in some areas. Now, Palladio Partners is joining forces with construction company HOCHTIEF to help make the future happen. The goal is to build a sustainable, 9,000 square meter data center in Heiligenhaus, North Rhine-Westphalia, by 2025. In March 2023, the partners signed the contract for the novel high-tech building, which is located in the university town’s innovation park.

The edge data center known by its product name, YEXIO. This is derived from the word “nexus”, which means a “link,” “connection,” or “interrelationship.” The building features an innovative water cooling system whose high energy density makes it highly energy-efficient. In addition, the center will be powered by locally generated renewable energy, including electricity from local photovoltaic plants. Other highlights include its green exterior facade and roof, and the municipality’s use of the waste heat produced, e.g., in swimming baths and hospitals. Siting the data centers in local neighborhoods creates synergy effects that benefit the municipalities. The projects have been optimized for both environmental and economic criteria. The goal is to give regional companies in particular access to sustainable services such as processing power and data storage on their doorstep, and hence to optimize line speeds.

Palladio Partners and HOCHTIEF are planning to jointly invest several hundred millions of euros in constructing and operating additional YEXIO data centers in the next few years. Palladio is contributing two main things to the partnership: capital from German investors for the project and its many years’ experience of the infrastructure sector. The investment boutique has been active in this area for over a decade now and is one of the leaders on the German infrastructure market, with more than EUR 9 billion of capital from institutional investors under management. Palladio Partners has been investing in municipal digitalization projects since 2019. Its experience in financing this type of project and its partnerships with municipalities and local authority utilities are extremely valuable for constructing the decentralized data centers.

HOCHTIEF has substantial data center experience, with orders on hand in this area already exceeding EUR 4 billion. HOCHTIEF’s US subsidiary Turner has built numerous data centers for many of the tech giants and currently has another 40 or so under construction. Last year alone, its incoming orders for data centers topped the EUR 3 billion mark.

Dr. Heribert Bodarwé, the project company’s managing director appointed by HOCHTIEF, said: “We are filling a sizable gap in the market with YEXIO. The need for sustainable edge data centers is particularly large in Germany. They are the basic infrastructure underpinning many new technologies and applications. Cloud computing is also becoming more and more important, as more and more companies are migrating their IT to the cloud while still wanting to process and store their data in the region.”

Palladio Managing Partner Bernd Kreuter sums up the partnership as follows: “Long-term capital from German retirement provision schemes is being invested sensibly in sustainable digital infrastructure, helping to transform our economy and ensuring Germany is fit for the future. The data centers we are implementing together are on a whole new economic and environment level.”