Bucharest Data Center Market Report

Overview: A Growing Digital Infrastructure Hub in Eastern Europe

Bucharest is emerging as an increasingly strategic location for data center investments, driven by its competitive energy prices, strong connectivity, and demand for colocation and edge computing. The market is still in its growth phase but has seen significant investment activity, particularly from hyperscalers, colocation providers, and enterprises expanding into Eastern Europe.

Market Supply and Demand Trends

Key Investment and Development Activity

• 📈 Romania’s data center market is expanding, with both new developments and acquisitions.
• Google signed a Memorandum of Understanding (MoU) with the Romanian government in 2023 to explore AI, cloud services, and digital infrastructure expansion in the region. While no official hyperscale project has been announced, this signals growing hyperscaler interest in Bucharest as a cloud and AI processing hub.
• ClusterPower opened Romania’s first hyperscale-ready data center campus in Mihăilești, near Bucharest, in 2022. The facility supports AI and high-performance computing (HPC) workloads and has plans to expand capacity beyond 200MW over the next decade.
• NXDATA, one of Romania’s largest carrier-neutral colocation providers, continues to expand its Bucharest facilities (NXDATA-1 & NXDATA-2) to meet growing demand from CDNs, financial institutions, and enterprises.
• Knight Frank has actively facilitated transactions in Romania’s digital infrastructure space, citing rising investor interest in regional colocation and edge computing hubs outside of traditional Western European markets.

Colocation and Hyperscale Expansion

• Telekom Romania (part of Deutsche Telekom) is expanding its colocation services in Bucharest, focusing on enterprise clients and hybrid cloud solutions.
• M247 and GTS Telecom, two key regional connectivity and hosting providers, have seen increased demand from international enterprises looking to establish a footprint in Romania.
• Orange Business Services is investing in edge computing capabilities and hybrid cloud solutions, reflecting the broader market trend towards distributed computing architectures.

Hyperscaler Interest and Cloud Expansion

• Amazon Web Services (AWS), Microsoft Azure, and Google Cloud have expanded their CDN and cloud infrastructure presence in Romania, though no major hyperscale data center announcements have been made yet.
• Google has signed an MoU with the Romanian government that may lead to future cloud and AI investments, positioning Bucharest as an AI and inferencing hub for Eastern Europe.

Connectivity: Subsea Cables, Fiber Infrastructure, and Internet Exchange

Subsea & Terrestrial Fiber Infrastructure

Bucharest benefits from strong fiber optic networks and direct connectivity to Western Europe, the Balkans, and the Black Sea region.

🔗 Key Subsea Cables Serving Romania:

• Black Sea Fiber Optic System (BSFOCS) – Links Romania with Bulgaria, Turkey, and Georgia
• KAFOS & MEDNAUTILUS – Connect Romania to Western Europe and the Mediterranean
• Danube Submarine Cable – Provides redundancy and cross-border connectivity

🔌 Terrestrial Fiber Networks:

• Strong backbone connections to Frankfurt, Vienna, and Budapest
• Direct peering with major European internet hubs (AMS-IX, DE-CIX, LINX)
• Multiple Tier 1 ISPs (Telekom Romania, Vodafone, Orange, RCS & RDS) ensure redundancy and high-speed connections

Internet Exchange (IX) Points

Bucharest has a well-established internet exchange (IX) ecosystem, enhancing low-latency connectivity across Eastern Europe.

🌍 Key Internet Exchanges in Bucharest:

• InterLAN IX – Romania’s largest neutral IX, handling major traffic exchange
• RoNIX (Romanian National Internet Exchange) – A government-supported IX
• NETIX & DE-CIX Bucharest – Expanding presence with global peering partners

Bucharest’s strong IX presence makes it a key regional hub for CDN providers, hyperscalers, and content-heavy applications.

Power & Energy Considerations

⚡ Electricity Prices & Grid Considerations

• ~$0.10-$0.12 per kWh – Lower than Western Europe, making Bucharest attractive for power-intensive workloads
• Energy mix: ~50% renewables (hydro, wind, solar) + expanding nuclear capacity
• Grid modernization efforts supported by EU investment

Lower energy costs and improving grid reliability make Bucharest a viable alternative to more expensive markets like Frankfurt or Paris.

Investment Climate & Regulatory Environment

Recent Transactions & Investment Trends

• Knight Frank has reported rising investment activity in Romania, with investors seeing Bucharest as an emerging edge compute and colocation hub.
• Google’s MoU signals potential hyperscaler investment, though no firm projects have been announced.
• ClusterPower’s campus is Romania’s first hyperscale-capable data center, with planned expansions that could exceed 200MW in capacity.

💰 Why Investors Are Interested in Bucharest:

• Lower real estate costs than major Western European hubs
• EU-backed infrastructure & energy transition funding
• Strong demand from IT outsourcing, gaming, and financial services

Regulatory Considerations

📜 Legal & Compliance Factors:

• EU GDPR-compliant jurisdiction
• Data sovereignty laws that favor local cloud providers
• Tax incentives for digital infrastructure & IT projects

Market Challenges & Constraints

🔴 Challenges for Data Center Operators in Bucharest:

• Power grid stability concerns – While improving, some areas still experience fluctuations
• Lack of large-scale hyperscaler deployments – Most hyperscalers rely on regional colocation partners instead of full-scale builds
• Talent competition – Romania’s strong IT outsourcing sector creates high demand for tech talent, leading to rising labor costs

However, ongoing infrastructure improvements and government-backed digital initiatives are helping to address these constraints.

Conclusion: Bucharest’s Position in the European Data Center Landscape

Bucharest is evolving into a key regional hub for colocation, edge computing, and AI-driven infrastructure, driven by:
✅ Strong fiber & subsea cable connectivity
✅ Competitive power costs & growing renewables
✅ Expanding colocation & enterprise cloud demand
✅ Government-backed digital transformation initiatives

While hyperscaler investment is still in its early stages, Bucharest is becoming a strategic edge computing location in Eastern Europe.

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