The Real Estate Espresso Podcast Why Would A Data Center Come To Your Neighborhood?
On today’s show we are looking at what might be the economic drivers for the construction of new data centres.
Data centres are a very capital intensive business. They consume a lot of land, electricity, water, and of course the hardware software and climate control equipment. They burden the local electric utility with a lot of demand and they don’t contribute very much to a city’s vibrancy. Nobody goes on a Sunday afternoon drive to look at the data center.
Apart from the fact that you have access to artificial intelligence applications from OpenAI and Google and Amazon and countless others, the data center doesn’t contribute to the community in a visible way. These applications are in the cloud and therefore their location is largely invisible.
A data center owner is looking for a few key elements.
- excellent optical fibre connectivity with redundant networks and multiple physical paths. This way a network outage does not represent a single point of failure.
- Adequate land and zoning at a reasonable price with a favourable property tax rate
- Plentiful and inexpensive electricity where the electric grid has redundant pathways which will make the data center more tolerant to local power outages.
- Access to a skilled talent pool or operate and maintain the data center.
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