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US Commercial And Real Estate Sector Readies For Data Centre Construction Boom

US Commercial And Real Estate Sector Readies For Data Centre Construction Boom

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National data centre business has not slowed down in 2016 with the market posed for more expansion in 2017 and beyond. 

The US data centre market is expected to continue as the largest market in the world despite current political and economic uncertainty.

According to BBG, a national commercial real-estate valuation, advisory and assessment firm, in 2016, data centres were “one of the hottest” commercial and real estate businesses in the country.

The company highlighted that major cloud service providers, such as Facebook, Google, Apple and Microsoft, have been actively snapping up data centre space to meet the ever-increasing demand for cloud computing, which is the storing of data over the Internet instead of a computer’s hard drive.

In a statement, BBG said: “A growing number of businesses are migrating their IT operations to the cloud in order to keep pace with the heavy volumes of data in today’s digital economy. “

According to IT analyst firm Gartner, more than $1 trillion in IT spending will be impacted by the shift to cloud technology during the next five years.

In 2016, data centre absorption rates hit record levels US, with the top 15 markets reaching 357.5 megawatts. Demand for data centre space is measured in absorption rates rather than square footage.

BBG added that according to a recent published report on data centre activity, continued growth in the data centre sector is expected to remain vibrant in 2017 as cloud computing usage heat up.

The report said the top four regions for data centre activity were Northern Virginia, Northern California, Chicago and Dallas-Fort Worth.

In a number of U.S. cities, there are significant data centre construction projects under way or planned for this year. But many users are not acquiring data centre facilities. Instead, they are using co-location facilities where users share space in the centres in an effort to reduce costs.

BBG CEO Chris Roach said: “The proliferation of data centre construction projects around the country is expected to be one of the brightest spots in the CRE sector in 2017 and in the years ahead, as more organizations adopt cloud technology to manage their data usage requirements.”

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