Dallas Sees Record Data Center Leasing Activity in 2022

Dallas sees record data center leasing activity in 2022

The glass facade of the Dallas Infomart, Dallas’ main operator hotel and connectivity hub, which was acquired by Equinix in 2018. (Photo: Rich Miller)

Successful data center leasing is no longer just a Northern Virginia phenomenon. As hyperscale operators continue to consume capacity, several markets across the country are beginning to see large rentals on a scale previously seen only in “Data Center Alley” in Ashburn.

The latest region to see boffo results is Dallas/Fort Worth, which had 286 megawatts of absorption in the first half of 2022, according to new research from real estate firm Cushman and Wakefield. Dallas’ strong activity follows a JLL report on large-scale leasing in Phoenix, where it reported 257 megawatts (MW) of uptake in the first six months of 2022. Meanwhile, the emerging hyperscale hub of Hillsboro, Oregon had 199 MW pre-leased in the second half of 2021, according to CBRE.

Rental of hundreds of MW was previously seen only in Northern Virginia, known as the “home of the cloud” for the huge concentration of infrastructure to support the growth of Amazon Web Services, Microsoft, Google and Meta. In some years, absorption in Loudoun and Prince William counties eclipsed combined rental in all other regions of the United States

This dynamic has changed as data center leasing has picked up momentum in 2022. Hyperscale operators are planning larger deployments in markets beyond Virginia and providing large-scale capacity to keep pace with the growth of the digital economy, which has been accelerated by the pandemic. business-related changes, including greater reliance on video and a more distributed workforce.

The data center industry has set absorption records in 2022 as hyperscale operators race to procure cloud capacity for long-term growth. Activity was boosted by fears that the delivery of future capacity could be slowed by supply chain disruptions, which are starting to cause more delays in data center construction.

Big deals in Dallas

Dallas saw about 5 times the annual amount of rentals in the first half of 2022, said Bo Bond, executive managing director of Cushman & Wakefield. Meta signed leases with three operators in the Dallas-Fort Worth area for more than 225 megawatts of data center capacity in the first half of 2022, Cushman reported.

Get the DCF Dallas market report.

These huge numbers are part of why we are seeing an increase in data center construction in Dallas/Fort Worth. Here are some details:

  • Compass Datacenters recently filed plans revealing an additional 250,000 SF data center on its growing hyperscale campus in Red Oak, Texas, one of several projects where Compass is building multiple large data centers.
  • QTS plans to invest $180 million in the expansion of its Irving campus in the Dallas market, filing plans to construct a 337,000 square foot data center building on land adjacent to its existing campus in Irving.
  • Aligned Data Centers has announced plans to expand its campus in Plano, adding a 36 MW data center to an existing campus. The DFW-02 facility will be 220,000 square feet, with 185,000 square feet of data room space.
  • Digital Realty has filed plans for a new data center on land it owns in Lewisville. Dubbed “Project Gold,” the facility will include 183,000 square feet of data center space.

“DFW is enjoying a record year of data center uptake as it continues to grow as a vital interconnect hub for major cloud providers, large financial and insurance companies, and leading technology companies “said Andrew Schaap, CEO of Aligned. “The region’s booming industrial market, dense and diverse connectivity infrastructure, access to talent, business-friendly environment, and abundant and affordable food make Dallas an ideal location for Aligned to expand further the footprint of its large-scale data center campus.

With big deals comes big challenges. As in other markets (particularly Virginia and Dublin), accelerating growth in Dallas may soon test the capacity of the region’s utility infrastructure.

“Dallas is experiencing supply constraints through 2023,” said Curt Holcomb, executive vice president of JLL in Dallas. “We are seeing an interesting supply and demand market that we have never seen before. We’re starting to look at bigger and bigger developments. This may mean new (power) transmission lines. »

#Dallas #sees #record #data #center #leasing #activity

Leave a Comment

Your email address will not be published. Required fields are marked *