Data Center Space in Low Supply

A study conducted by a commercial real estate company has found that data center vacancy space is in short supply. This issue is a major problem for companies with large requirements and a good thing for the few sites that still have the space.

Kerrigan said several traditional data center hubs are facing acute shortages of space that can accommodate large users in a short time frame. “Northern Virginia has some issues because there’s major demand there,” said Kerrigan, nopting a recent series of large leases. “We still don’t know about the government requirements coming out of the stimulus package, which could have a big impact on supply. Santa Clara (Calif.) also has a big supply issue right now.”

I wonder how hard it is to get a small data center setup =P Would love to offer this kind of service, will have to do some research tonight

Mainly because no one is building really, not right now at least.

I think it would be awesome for a Computer/cable company to come in to a little town (Kingman,AZ-pop 21k) and build the whole town to be a data center gateway/web hosting site(s), utilizing cheap energy and giving residents there a boost in thier economy. Can you imagine a whole town wired for FiOS internet?

Originally Posted by Kazzanova

I wonder how hard it is to get a small data center setup =P Would love to offer this kind of service, will have to do some research tonight

many millions of dollars, there are a lot of things to take into account such as backup power, air conditioning, natural disaster protection, security issues, and the list goes on.

Originally Posted by Kazzanova

I wonder how hard it is to get a small data center setup =P Would love to offer this kind of service, will have to do some research tonight

A good figure to get you started: Work on 750-1,000 per sq ft.

Originally Posted by Roliath

Mainly because no one is building really, not right now at least.

Not true at all. We can hardly keep up, we are planning two more expansions before the end of this year. I just finished with two other facilities and the two competing facilities have just finished building additional facilities and are already filled up.

The main issue in todays market is financing, this is what is keeping a lot of these facilities from massive expansions. The year 2009-2012 is going to be the hottest years for this industry, the demand is great.

Originally Posted by ripken204

many millions of dollars, there are a lot of things to take into account such as backup power, air conditioning, natural disaster protection, security issues, and the list goes on.

Yep. It ain't cheap.

You'd better spend money setting up a little web hosting farm first for SMBs that may not care about extreme uptimes.

Originally Posted by Ockie

Not true at all. We can hardly keep up, we are planning two more expansions before the end of this year.

I think the truth is between those two extremes though.

If companies can still function without spending the money on a data center, they aren't going to build one. Simple as that.

And I know many companies around here, even if they have the money to do extra projects, are holding off on them for now until we're positive this economic slump is over (There's good reason we could hit new lows here in the next couple of months what with the news from Europe and all...)

Originally Posted by TechieSooner

I think the truth is between those two extremes though.

If companies can still function without spending the money on a data center, they aren't going to build one. Simple as that.

And I know many companies around here, even if they have the money to do extra projects, are holding off on them for now until we're positive this economic slump is over (There's good reason we could hit new lows here in the next couple of months what with the news from Europe and all...)

I do not agree. I think you are confusing private facility use with niche facility use such as the colo lease markets.

Yes, companies such as GM isn't going to build new facilities if they don't need to, these types of companies comes to us and lease floor spaces from our facilities. People and companies alike are putting their systems in shared facilities... which is the biggest market user for data centers.

To show you an example, you can visit some sites with facilities currently for sale or lease, as you will find, rather quickly might I add, that these facilities are quite limited. Places like DMP (Digital Millennium Properties) are having hard time getting facilities listed because of the demand. Most companies are either keeping their facilities or selling them privately.

Most of the sites you will find listed are old CLEC sites which are inadequate for the new data center capacity demands. Many facilities are seeking out 500-1,500w per sqft foot prints.


And also, the economic state does not have the impact on data centers as you make them to be. The trend is actually a reverse trend. Like you said, companies are not going to build private facilities... they would rather come to facilities like us and lease space instead... this gives them the most financial flexibility while still getting a foot print. With the economic downturn, we are seeing incredible business.

Originally Posted by Ockie

And also, the economic state does not have the impact on data centers as you make them to be. The trend is actually a reverse trend. Like you said, companies are not going to build private facilities... they would rather come to facilities like us and lease space instead... this gives them the most financial flexibility while still getting a foot print. With the economic downturn, we are seeing incredible business.

I would agree that software companies will be least hurt in economic times. Like Google... People are still searching and generating ad revenue.

However any company tied to a material good is getting hurt right now, and that was my point about GM.

You're probably right about leasing, though... I'm sure many companies are signing on for short(ish) term leases until things pick up.