Chicago developers in “an arms race” to build giant data centers

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http://www.chicagobusiness.com/article/20161112/ISSUE01/311129993/chicago-developers-in-an-arms-race-to-build-giant-data-centers

It’s not much to look at now, just a patch of dirt at Calumet Avenue and 21st Street, squeezed between McCormick Place and a new basketball arena.

But developers plan to build a huge data center to complement an older facility across Calumet at 350 E. Cermak Road, one of the biggest server farms in the United States.

Like the rest of the country, Chicago is enjoying a wave of construction of data centers, the big, nondescript industrial buildings that house the servers that deliver Facebook posts to smartphones, Netflix to TVs and business software to laptops.

More software and data are shifting to the cloud, moving from companies’ own servers and data centers to those operated by Amazon, Microsoft, Google and IBM. The software that companies buy from Oracle, Salesforce.com and Microsoft also is in the cloud. All those Periscope video streams, Instagram photos and Snaps require data center space. So do on-demand music services, like the one recently launched by Amazon, and multiplayer video games.

“It’s an arms race,” says Kam Patel, an executive in suburban Minneapolis at CommScope, which provides cabling and other gear for data centers. “Cloud providers want to be close to the population base.”

Increasingly, these companies lease space in big multitenant data centers rather than building their own. Last year, Chicago had the second highest absorption of multitenant data center space by customers of any city in the country, according to real estate brokerage North American Data Centers. The most space was gobbled up by Microsoft, Facebook, Oracle, Jump Trading and Salesforce (see the NADC’s PDF).

The amount of new data center space, measured in megawatts, leased in Chicago more than tripled from 2014 to 2015 to 27 megawatts, according to real estate firm CBRE. Through the first nine months of 2016, it was 37.

Until now most of the data center activity in the Chicago area has been in the suburbs, where land and other costs are cheaper than in the city.

That’s unlikely to change: Through 2018, suburban data center capacity will grow about 13 percent a year, compared with 4 percent downtown, estimates 451 Research.

But demand has picked up in the city recently, giving San Francisco-based Digital Realty Trust, which owns 350 E. Cermak and more than 100 other U.S. data centers, the confidence to announce plans to build an expansion.

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thanks to intrigued for the link..

cloud chasers..data hoarders..

data is gold..

“It’s an arms race,” says Kam Patel, an executive in suburban Minneapolis at CommScope, which provides cabling and other gear for data centers. “Cloud providers want to be close to the population base.”

401

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~ by seeker401 on November 24, 2016.

5 Responses to “Chicago developers in “an arms race” to build giant data centers”

  1. Reblogged this on World Peace Forum.

  2. …not to mention the future home of the fed…Chicago that is.

  3. Thanks brother, hadn’t seen that one…”the fed will rely on an array of new tools to…”

    More data on you to keep your assets and your ass in maximum taxable position.

    Their day is coming…

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