Data Centers: Mission Critical Solutions - Area Development Magazine

THE C-SUITE

Perspective on Data Center Location PAGE 4

Development & FINANCING Strategies PAGE 8

Redefining Resiliency PAGE 12

2016

Special Supplement to Area Development Magazine

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CONTENTS Features

4 The C-Suite Perspective

on Data Center Location

Editor’s Note

Allowing ample time for evaluation, while weighing risks against costs, will result in choosing the optimum data center location.

s the volume of data increases for both business and personal use, data center development is occurring across the nation. These mission-critical, capital-intensive facilities are being developed as both co-location and single-user spaces. And although the decision of where to locate a data center facility will differ depending on the needs of the end user, certain criteria are paramount to all data center operations.

8 Data Center Development

A

According to the Data Center Solutions Group at CBRE, chief among these criteria is latency, i.e., the time it takes for information to travel from one location to another via the telecom infrastructure. Risk tolerance and qualified labor are other primary concerns. Then once “no go” locations have been eliminated, costs may be the final determinant.

The increase in computing power and IT equipment means there is a need for more power and cooling to keep the systems running, says Rajan Battish of CallisonRTKL’s Mission Critical Group. He explains that data center infrastructure is driving up the total cost of ownership (TCO), which must also be comprehensively examined.

And since these facilities are so capital-intensive, financing strategies must be closely examined as well. In addition to mortgages and traditional financing options, those at Duff & Phelps say to look to financing from publicly traded real estate companies as well as institutional investors and end-users themselves.

All this advice and more information are included in this Data Centers supplement to Area Development magazine. You can also find contact information for the sponsoring organizations that can help your company with its next data center site selection decision.

and Financing Strategies

Industry-specific factors to examine when evaluating data center locations include power needs/costs, scalability, and security; and carefully examine financing strategies for these capitalintensive investments as well.

12 Redefining Data

Center Resiliency

Data center operators, faced with the challenge of providing resiliency for these mission-critical facilities while lowering costs, need to evaluate the TCO.

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©2016 Custom Publishing Group of Halcyon Business Publications, Inc., Publisher of Area Development Magazine PUBLISHER: Dennis J. Shea ART & DESIGN: Patricia Zedalis EDITOR: Geraldine Gambale PRODUCTION MANAGER: Jessica Whitebook FINANCE: Mary Paulsen PRODUCTION ASSISTANT: Talea Gormican

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2016 • 3

THE C-SUITE PERSPECTIVE ON DATA CENTER LOCATION Allowing ample time for evaluation, while weighing risks against costs, will result in choosing the optimum data center location.

DATA CENTER SITE SELECTION FACTORS plicated data center transactions in an environment where the stakes are higher than ever and the options multiply daily.

Let’s evaluate the top questions corporate executives face when determining the optimum data center location solutions:

How do I determine the right location?

I

n 2016, every company is a technology company.

As the volume of data increases and becomes ever more important to the function and even viability of an enterprise, business executives are increasingly tasked with ensuring that their companies stay ahead of the technology curve, while keeping costs low and minimizing risk. Corporate real estate executives must work hand-in-hand with their IT and finance counterparts to evaluate and execute comBy Kristina Metzger and James McCarthy, Data Center Solutions Group, CBRE 4 •

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It depends! Unfortunately, there is no one size fits all when it comes to data center site selection. We laugh when, undoubtedly, on every project some far-removed executive or senior leader begs the question, “Well, Facebook (Google, Microsoft, Amazon, etc.) just announced a data center in Sweden (Iceland, the North Pole, a container on ship, or other remote location); how come we are not doing that?” Well, for starters, you are not Facebook, Google, Microsoft, or Amazon.

You do not have 30 data centers worldwide that can fail over to each other. It is likely that you, like most enterprises, have between two and five data centers that need to be located within some proximity of each other and your main user base in order to maintain operations. In order to determine the optimum location, leading enterprises start by deter-

mining any limitations to site location, then evaluate that search area to determine the optimum location for their risk profile at the lowest net cost attainable.

Typically, latency is the most limiting factor in data center site selection. Latency is the time it takes for information to travel from one location to another via telecommunications infrastructure. Most applications have a latency threshold at which they can no longer operate efficiently or at all, expressed in milliseconds. This may equate to a search area of X milliseconds from a headquarters location or perhaps an existing operational data center. Regardless of how cheap it may be to have a data center or even office space in Iceland, if you cannot maintain your operations or get the right staff to go there, it is a non-starter.

Once the search area is established, enterprises should engage in a systematic process of eliminating any locations in violation of absolute requirements, while evaluating and weighing discretionary and

financial factors. An absolute criterion might consist of a distance threshold from an existing location; this could be due to operational benefits or perhaps risk avoidance of two facilities subject to the same hazard. Other factors may include a perceived risk of downtime.

An enterprise’s risk tolerance can vary dramatically and typically is driven by industry and operations. Banks, aerospace and defense contractors, and government user requirements tend to be the most risk-averse — meaning the cost of downtime far exceeds any financial benefit of any location.

For example, a large financial institution determined that for every one minute of downtime, it incurred $7 million in lost revenue. For other clients, the risk of location is weighed with financial or operational benefits. When given a choice, all else being equal (i.e., good accessibility, a strong labor pool, and other industry- and client-specific factors), clients should avoid areas subject to wide

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For many, cost is the determinant factor in choosing the final location.

area disruption (earthquakes, hurricanes, tornadoes, flood zones, etc.)

After eliminating locations subject to any absolute “no go” criteria, for many the determinant factor in choosing the final location is cost. While the cost of electricity is largely known to be a driver, you’d be surprised how many enterprises and executives fail to evaluate the impact of taxes until advised to do so. The determination and evaluation of both statutory and discretionary tax incentives for data centers can equate to millions of dollars in variance from one location to another.

Other operational differences such as free cooling by the utilization of outside air, network costs, and labor costs can also drive an impact to the bottom line. At the end of the day, the net total cost — accounting for all IT and real estate expenses — for each location under consideration is evaluated to facilitate informed decisions.

With technology evolving so quickly, how do I know I am picking the right solution today that can accommodate the needs of tomorrow?

Data center technologies are constantly evolving, as are the physical requirements to support them.

Most of the equipment used in data centers today did not exist 20 years ago. How can a company guarantee the solution that is best now will accommodate technologies that have not been invented and adopted yet? The short answer is it can’t, so companies must acquire and develop flexible solutions expressly designed to accommodate future change. Leadingedge companies are limiting exposure to future technological obsolescence by outsourcing to third parties, reserving shell capacity, and increasing the density potential of the solutions selected.

The move to outsourcing is the single largest trend among enterprise users. Whether that means a build-to-suit leaseback, wholesale colocation, or fully outsourced cloud solution, companies are leasing third-party solutions to avoid the risk of carrying highly capital-intensive, potentially technologically obsolescent assets on their own books. Financial

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benefits aside, leasing or outsourcing allows companies to secure shortterm solutions based on what they know to be true today, while reserving the ability to modify in the near future as their own requirements and technology evolve.

Regardless of whether a company outsources or decides to own and develop itself, smart enterprises are reserving shell space for future growth and development. For a large deployment, this might entail dedicated adjacent land for future development, or building out a shell building to accommodate quick, adjacent expansion. For a colocation user, this likely entails a right of first offer or refusal on adjacent critical areas. The overall cost of land, shell building, or expansion right is typically nominal relative to the potential cost of migration to a new location.

One trend that has continued for some time is the increase in power density over time in the data center facility. Just a few years ago, most facilities were built to accommodate up to 150 watts per critical square foot. Today, with increased adoption of virtualization and high-performance compute environments, many facilities are being developed or acquired to accommodate 300 watts or more per critical square foot. Whether or not an enterprise is utilizing these densities today, they desire the ability to do so in the future.

How do I cover all bases and ensure a successful process?

The most successful projects are the ones that allow ample time for a thorough evaluation of all market alternatives driven by a team of seasoned experts, both internal and external to the enterprise, to facilitate informed decisions. Determining the optimum site location; engaging in a competitive negotiation process; and developing, commissioning, and migrating to a new data center can easily be a 36-month process. One of the biggest mistakes enterprises make today is not beginning the process early enough, leaving only a fraction of the opportunities or locations available for evaluation. This fatal error can result in tens of millions of dollars of

increased cost over an analysis period.

While data center trends and market conditions continue to evolve, one thing remains constant in the life of the corporate executive: the importance of an auditable process. Given the large amounts of capital behind a data center acquisition, it’s not uncommon for these decisions to require board-level approval.

A team’s ability to navigate, record, and display the data center acquisition process from start to finish is paramount to transaction success.

A typical enterprise might engage in a data center evaluation once every few years. With the evolution of technology, solutions and market dynamics changing daily, data from an enterprise’s last transaction is already obsolete. Coupling internal IT professionals who understand the “hows” and “whys” of the underlying requirements with seasoned third-party experts in the fields of data center incentives, site selection, and negotiation drives optimum results.

In Sum As market dynamics continue to change, the solutions will be adjusted to match the expectations of data center users in the market — expectations corporate real estate executives are required to understand well. Smart companies engage in strategic planning months, if not years, in advance and evaluate existing solutions often in order to keep their companies ahead of the curve and operating most efficiently.

KRISTINA METZGER AND JAMES MCCARTHY specialize in the evaluation and acquisition of data center solutions on behalf of enterprise users across the globe. They have successfully advised many of the largest and most technologically advanced enterprises in the determination, negotiation and acquisition of the optimum data center solutions, including AT&T, American Express, Broadcom, The Boeing Company, Dell, Disney, IBM, and many others. They are members of CBRE’s Data Center Solutions Group and can be reached at kristina.metzger@cbre.com and james.mccarthy@cbre.com.

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DATA CENTER DEVELOPMENT AND FINANCING STRATEGIES Industry-specific factors to examine when evaluating data center locations include power needs/costs, scalability, and security; and carefully examine financing strategies for these capital-intensive investments as well. by single server space.2 This article will examine evaluation criteria and highlight financing alternatives to help propel your business decisions on data center development.

courtesy Switch

Criteria for Evaluation

A Switch rendering of the Steelcase Pyramid Project in Michigan

T

o co-locate or not to co-locate — this may be the question du jour if you are a large data consumer or a company with high growth ambitions and increased utilization from online processing. While you may be considering scalability, redundancy, security, and compliance as key factors in determining whether you should host your own server, your competitors might also be considering power consumption and financing techniques to gain an edge on costs.

According to IBIS World, data center co-location generated over $29 billion in revenue in 2015, with an annual growth rate over the last five years of 13 percent1; and within this $29 billion industry, only 54.5 percent of these dollars were generated

In evaluating data center locations there are a number of industry-specific factors to consider. For example, what are your needs? If you are a healthcare provider, tech company, financial institution, or other large data user, do you need dedicated space that can accommodate the privacy requirements mandated by your business or industry? Also, how much power do you need to run your equipment?

Many tenants can get by with retail co-located space managed by others (e.g., space for servers in a cage in a data center) as opposed to dedicated leased premises with numerous servers and other equipment (wholesale space). Be forewarned, the cost of data center space far exceeds that of office or industrial space and is generally based on power capacity made available to a tenant rather than square footage.

Power surge: Don’t buy more power than you need unless you anticipate immediate expansion requirements. If you are entering into a co-location agreement, determine the reputation of the party running

By Gregory Burkart and Laca Wong-Hammond, Duff & Phelps, LLC; and Stephen E. Friedberg, Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. 8 •

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the data center space and that of the data center owner/operator. Data centers use huge amounts of power, both for cooling and electrical redundancy purposes. You should determine the reliability of that power (e.g., whether it complies with industry specifications such as the ITIC (CBEMA) Curve, and whether there at least two feeds of power to the data center from separate electric substations (or better yet, from different providers).

Seek broader broadband: Additionally, you should ask whether there are broadband connections from a number of different providers, so there is little chance of a failure. You can look for ratings from third-party rating agencies, such as the Uptime Institute.

Data centers are rated from Tier I (most basic) through Tier IV (most redundant and reliable) and are based on numerous factors including redundancy of the power, cooling, and broadband availability.

However, the equipment needed to make a center more fault tolerant (e.g., additional cooling systems, more than one generator for each circuit, redundant UPS systems, etc.) is more expensive, and the cost for higher-rated data centers is concomitantly greater than that in a lower rated center; thus, if the information being backed up in the data center is not mission-critical, it is foolish to lease higher-rated space than necessary.

Please also note that, technically, data centers are known (and advertised) as N+1, 2N and 2N+1 — the industry technical terms for the level of redundancy of the systems of the data center — which generally equates to its reliability when a power or equipment failure occurs (and is the landlord’s claimed level of redundancy).

Temperature matters: A large consumer of power in a data center is the specialized cooling equipment needed to protect the servers and other electronic equipment that require specific operating ranges for both temperature and humidity. Accordingly, it is critical that your lease specifies the ratings for temperature control and humidity levels promulgated by ASHRAE for data centers (currently the 2011 Thermal Guidelines).

Scaling your storage: Another area to explore is the

scalability of the center to meet your future requirements. If you project increased needs over time, determine if there is enough power capacity at the data center to meet your requirements and whether you can reserve your anticipated power requirements through an option, right of first refusal or right of first offer.

If you are a user with larger requirements, you should determine whether to develop the space on your own, have the space or data center built for you on a build-to-suit basis, or enter into a lease with a landlord for pre-built space that you will improve. The design criteria for the redundant systems, UPS devices, generators and other switchgear, the meet-me rooms for interconnection with other tenants, and specialty cooling and fire suppression systems, etc. require a high level of expertise not generally offered by your IT or other design and construction professionals. The cost of building a data center is a multiple of that for building other space, as the equipment is both expensive and specialized. In almost all cases, it makes sense to have an experienced data center operator build the space for you.

Lock down security: Another factor to consider is your security requirements (the level of security, both on an IT and physical basis, can be key to keeping the tenant’s equipment and its trade or client secrets confidential).

As an example, if the data center contains patient records or information, the center and its security protections must be HIPAA compliant. Other industries have their own security issues (e.g., cable companies not wanting someone to disseminate media not approved by the company or the stations it is carrying or violating FCC or broadcast rules).

Also, make sure the data center’s auditors provide an SSAE 16 certification so your auditor can rely on it in your audit.

Financing Alternatives Data centers involve significant capital investment. In addition to mortgages and traditional financing options, financing is available from publicly traded real estate companies as well as institutional investors and end-users themselves. Structures such as sale/leasebacks, development financing, and 2015 • 9

sales to real estate investment trusts (REITs) or other real estate investors have enabled cost of capital to be driven down on data centers. The average dividend yield for the top data center REITs, a proxy for their cost of capital, averaged 4.2 percent over the last five years.3

There are many state or local programs that can assist financially in data center transactions.

Finding the right funds: Public/ private partnership benefits should be considered in your evaluation of this expensive space. There are many state or local programs that can assist landlords and tenants in data center transactions. Examples include real estate tax relief and sales tax benefits for the cost of equipment, and landlord or tenant improvements through industrial development agencies, TIF financing, and other benefits that may be available. In some states there are utility incentives available to building owners that can help ameliorate the costs of what can be the secondmost-expensive part of the ongoing cost of space in a data center. All of these avenues should be explored by landlords and tenants looking at this space.

Case-in-point: Santa arrived a few days early in Western Michigan. At the end of its legislative session, Michigan’s House of Representatives and Senate enacted two bills designed to attract Switch’s $5 billion, 1,000-job data center to the site of a former headquarters for Steelcase. On December 23, 2015, Governor Snyder signed the bill creating and expanding sales and use tax exemptions for data centers in Michigan.4 Until Michigan passed its new legislation, the state did not have the typical incentive tools to attract data centers. Most states and local communities employ a mix of exemptions, credits, or abatements to reduce sales/use, property, excise, and income taxes associated with data centers. In Arizona, for example, the state provides an exemption to its Transaction Privilege Tax (TPT) and use tax exemptions at the state, county, and local levels on the pur-

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chases of qualifying computer data center equipment.5 Like Michigan’s new legislation, Arizona tailored its incentives to benefit both co-location (multi-tenant) and single occupant data center developments. Additional features in Arizona include benefits for existing owners/operators who have invested at least $250 million in the state over the prior six years.

Questions to consider: Since the incentives vary widely between the states, a practitioner should carefully compare the benefits and requirements of each location before committing a project to a state. Here are a few questions to consider:

• What is the type of incentive offered? Is the incentive an exemption — where 100 percent of the asset is excluded from taxation — or is the incentive an abatement — where the asset is subject to taxation but at a reduced rate?

• Who is eligible for the incentive? Does the state permit co-locators and operators to obtain the incentives or does the state restrict the incentives to the owner of the real property? Also, if a state permits co-locators to be eligible, are there additional requirements?

• What is the term of the incentive? For example, under Michigan’s new legislation, the sales/use tax exemptions may be available for up to 20 years if the owner meets certain job-creation thresholds. Or in Arizona, the exemption is available for 10 years unless the project qualifies as a Sustainable Redevelopment Project, which receives a 20-year term.

• What type of property is eligible for the incentive?

For example, does the incentive extend to land, construction materials, computers, servers, routers, switches, peripheral computer devices, racks, shelving, power supply equipment, computer software, among others? Does the incentive restrict the equipment to just operations or does it permit equipment

that is also required to manage, secure, or maintain the data center?

• How does the state treat energy and telecom for the project? Does the state exempt any utility user, sales or excise taxes on electricity or telecom services? Or, does the state permit electrical equipment owned by utilities to qualify for the incentive?

• What is the process to obtain the incentive? Does the state require an application or a letter of certification? Or does the state permit the data center owner to issue its own exemption certificates to suppliers/vendors? Are there “but for” requirements or does the state require an agreement to be in place before receiving the benefits?

you in evaluating your needs. These include brokers, attorneys, and engineers who specialize in data centers and, for larger transactions, financial consultants or investment bankers who can guide you in financing the costs of building and evaluating these spaces, including planning for future expansion.

Make sure the professionals assisting you have completed many data center transactions, as the learning curve is too steep, and the potential downside too severe, to allow someone to try to learn “on-the-job” on such a technically specialized area.

Notes: 1 IBIS World Industry Report OD5899 March 2015.

2 IBIS World Industry Report OD5899 March 2015.

3 Source: CapIQ average dividend of COR, CONE, DFT, DLR, EQIX, QTS from 1/1/2010 to 12/31/2015.

4 See Public Acts 251 and 252 of 2015.

5 See A.R.S. Section 41-1519.

• Is the incentive limited or tied to an exogenous event? For example, did the legislature approve a limited number of exemptions on an annual basis or is the legislature required to appropriate funds on an annual basis for the incentive? Or, does the legislature have to replace lost funds to a state aid account?

• Does the state impose penalties or claw back any of the benefits if the project does not meet its promised performance measures? If so, does the state impose interest and penalties on top of the benefit that has to be returned to the state?

Bottom line: Let the experts guide you. Data centers are important but capital-intensive endeavors. A key consideration in this area is finding the right professionals to guide 2015 • 11 AREA0549.indd 1

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REDEFINING DATA CENTER RESILIENCY Data center operators, faced with the challenge of providing resiliency for these mission-critical facilities while lowering costs, need to evaluate the TCO. Costs

1

TCO Curve

2 3 PC Life Cycle (Years) PC Acquisition Costs

Maintenance Costs

4

The Stress Factor Training Costs

W

ith the commercialization of advanced technology ranging from smartphones to laptops with more powerful processors, the computing power available to people today is astounding. The rise of social media, search engines, and digital content has led to an on-demand culture where instant access is a non-negotiable. Technology companies such as Facebook, Google, Microsoft, and Amazon are in rapid deployment mode in order to meet this insatiable need. Less obvious is the

By Rajan Battish, Vice President and Director, Mission Critical Group, CallisonRTKL. 12 •

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impact this change has on data center design. How do data centers stay resilient in the brave, new 24/7 tech world?

Technology capacities that used to be reserved for a select few in the industry — such as government agencies, university researchers, and limited corporate groups — have now become mainstream.

The growth not only follows Moore’s law of doubling of compute power but also relative storage of data principles. Lower cost storage devices, from SANs to consumer flash drives, are allowing for information to be saved at very low costs. The cloud is also helping us access that information virtually anywhere we have access to communication systems. The storage growth is driven by our ability to communicate easily through various mediums such as online images, electronic patient records, or emails.

While the affordability of computing and data storage has allowed us to utilize technology in ways that previously would have been prohibited by cost, the estimated seven billion users put a tremendous amount of stress on the data center market. More computing power and IT equipment usage means there is a need for more power and cooling to keep the systems running.

At the same time, this can only happen if the correct infrastructure is in place. The mechanical and electrical systems to support the data center computers still follow the traditional standards that were developed over 100 years ago and are very slow to change. As a result, some infrastructures are driving

up the total cost of ownership (TCO) and now costing as much as or even more than the equipment housed within these facilities. In order to create data center facilities that will continue to work with the fast pace of technology, infrastructure systems must be adapted to meet today’s new standards.

Impact on Data Center Lifecycle Aside from infrastructure costs, there are other factors that affect the TCO of data centers. The TCO takes into account initial infrastructure capital, the operating capital, and IT compute cost (such as refresh cycle and software).

Due to cheaper IT equipment costs, the infrastructure capital and operating costs are starting to approach and even exceed the IT costs. Cheaper compute cost and push in software and network technology have allowed failover redundancies that were not possible in the past, thus impacting the requirements of the infrastructure resiliency of the data centers. The IT failover redundancy is challenging the traditional resiliency of data centers where infrastructure redundancies were needed to support the mission. This change in application redundancy in lieu of infrastructure redundancy is causing reevaluation of the TCO. The impact of infrastructure redundancy requirements can cause variations in cost from lower redundancy systems to higher resilient systems, which can cost three times as much; additionally, the operating costs can be on the order of twice as much. Most infrastructure is designed for traditional brick-and-mortar buildings for up to 40-plus years, and the life of associated mechanical and electrical infrastructure can range from 20 to 40 years as well. The technology refresh cycle changes every 18 to 36 months. The difference in how technology has changed over the years compared to infrastructure equipment has created economic pressures to redefine the resiliency for IT compute.

Responding to the Market In the past, the data center was designed for power consumption of less than 30 watts/square foot and required multiple levels of redundancies in electrical and mechanical systems at the facility. The objective was to ensure there was no environmental impact on the IT equipment and that it remained op-

erational without regard to the environmental conditions beyond the pristine white raised floor on which the equipment was installed. The IT equipment was also larger and had lower compute capabilities, the amount of power consumed relative to the footprint was low, and the ability to deliver the power and cooling was easily matched with available infrastructure equipment.

The data center market has now reached a stage where power requirements can be high as 800 watts/ square foot of compute. A data center can be 1,200 square feet with power requirements the equivalent of up to 500 houses. The major cost of construction of the data center involves the mechanical and electrical infrastructure, along with redundancy requirements for that infrastructure. This increase in power density is not solely because we are performing more compute; in fact, IT compute is consuming less energy per compute now than 20 years ago. The significant impact is sheer volume of compute. To respond to the market drivers, the following changes in resiliency are occurring: • Reliance on software redundancy — Since compute is relative cheap, it is cheaper to build and operate two or more facilities with lower redundancy.

Utilizing the TCO for life expectancy of the IT and infrastructure should be evaluated for validation.

• Procurement of next-generation IT compute to reduce power consumption at the existing facility — This extends the life of the data center. The next generation of compute is higher efficiency, and with consolidated compute structure, the existing building and infrastructure may continue to support the mission.

• Utilization of modular infrastructure equipment that is standardized — Customization costs significantly more than buying the “Model T.” Because the redundancy can be through various sites in lieu of single site, the modular standard solution can be utilized at the other data center location if the IT growth projections do not occur at one site compared to another.

Continued on page 18 2015 • 13

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Fabcon makes panels in thicknesses of 8”, 10”, and 12”, enabling you to right-size the thermal performance of your structure.

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and foam billets has resulted in a precast panel that is lighter, stronger, and thermally superior to the panels of even a decade ago.

Our unique panel composition tests an average of 30 percent higher in R-value than comparable precast panels, a fact that may even enable you to downsize heating and cooling units. Fabcon’s ability to customize R-values means you’ll always have the opportunity to design to your needs, not to the confining realities of a “one-size-fits-all” product.

The speed and predictability of our construction process is attractive, but what brings customers such as UPS, FedEx, and Amazon back time and time again is the performance of our panel. It offers the advantage of a load-bearing panel, with fire ratings up to 4 hours and wind resistance up to 11,000 PSI. Our panels come in hundreds of finish options and a lifetime of minimal maintenance.

As our tagline BETTER, STRONGER, FASTER implies, Fabcon sets the standard for performance, service, and innovation.

We understand there’s more to being a great partner than producing a versatile, cost-effective product. Our expertly trained crews and a full engineering support staff make Fabcon uniquely qualified to help you grow quickly and responsibly.

2016 • 15

Dutchess County, N.Y. — A Hot Spot for Data Centers

Don Minichino Director of Business Attraction Th!nk Dutchess Alliance for Business 3 Neptune Road Poughkeepsie, NY 12601 Office: 845-463-5400 Fax: 845-463-0100 don@thinkdutchess.com www.thinkdutchess.com

New York’s Dutchess County, just 60 miles from Manhattan, is a prime location for primary and secondary data centers. Dutchess County offers excellent access to major metropolitan areas, a plethora of state incentives, solid power infrastructure, and a robust tech community.

cations connectivity, competitive reliable and redundant power, and inexpensive utilities rates, offering the necessary resources needed to sustain data centers. Businesses here reap the benefits of a highly skilled, educated workforce. Dutchess County is home to award-winning institutions including Bard Dutchess College, Marist County is within College and a six-hour drive Vassar Colof 68 million lege. Dutchess U.S. and CanaCounty is also dian customers within an hour’s and 21 percent drive of other of American major educaDutchess County features more than a million square feet of available data center co-location and single-user space with heavy power and broadband connectivity, manufacturers tional institujust 90 minutes from NYC. with access to tions including a $227 billion SUNY Purchase, retail sales market. It boasts easy access to Pace University, and the United States Military major transportation that includes Amtrak and Academy — many with engineering programs.

MetroNorth railroads, Dutchess County and Stewart International airports, and interstates Dutchess County is home to a cluster of ma84 and 87 — making it a hub of activity for the jor technology companies including IBM, which tri-state area. was founded in Poughkeepsie in 1911, GlobalFoundries and CyrusOne. The growing tech inBusinesses looking to expand or relocate their dustry has spurred a thriving high-tech commudata centers to Dutchess County can take adnity including New York State Cloud Computing vantage of a range of state and local incentives. and Analytics Center, Marist’s Institute for Data START-UP NY offers 10 years of tax-free operaCenter Professionals, and Hudson Valley Tech tion — no business, corporate, property, income, Meetup — a networking group of more than sales, state, or local taxes. Additional incentive 800 skilled tech workers. IBM maintains several and funding packages are available for companies facilities in the county — from manufacturing that create new high-tech jobs; revitalize older, and research and development to test laboratoabandoned buildings; and wire new or existing ries and customer service. buildings, which include equipment for backup generation and advanced energy-efficient In a nutshell, New York’s Dutchess County ofsystems. Dutchess County businesses can also fers a high quality of life in a strategic location take advantage of an expedited permitting and at an affordable cost. When thinking of relocatsmooth review process to ensure quick approvals ing or expanding your existing data center… and construction.

Dutchess County boasts robust telecommuniTh!nk Dutchess.

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dataCENTERS

Creating Homes for Businesses Since 1967®

Vince Bagli, MD Leasing Merritt Properties •••

Keith Wallace, VA leasing Merritt Properties •••

2066 Lord Baltimore Drive Baltimore, MD 21244 410-298-2600 Fax: 410-298-9644

20098 Ashbrook Place, Suite 160 Ashburn, VA 20147 703-858-2725 Fax: 703-858-7329 info@merrittproperties.com www.merrittproperties.com

At Merritt Properties, we don’t just develop and manage commercial properties — we create homes for businesses. With this philosophy in mind, we’ve been providing area companies with office, flex, warehouse, and retail spaces throughout Maryland and Northern Virginia for nearly 50 years. And, we now hold the largest privately held commercial real estate portfolio in the region, allowing us to proudly serve all sizes and types of companies in a wide roster of industries.

But, we build more than buildings — we build long-

Harness the POWER of Nebraska

term relationships that allow us to support your business as it evolves.

With award-winning construction and customer service teams, you can rest assured that we will address your needs and deliver on our promises. Leroy Merritt, who founded our company back in 1967, often completed deals on a handshake, and that level of trust and integrity continues at our company today. Whether you’re looking for a green office building, a data center, a manufacturing facility, or a distribution warehouse, let Merritt create a workspace that your company will be proud to call home.

Mary Plettner, CEcD Economic Development Manager Nebraska Public Power District ••• 1414 15th Street PO Box 499 Columbus, NE 68602-0499 402-563-5534 Fax: 402-563-5090 econdev.nppd.com econdev@nppd.com

Each year, Nebraska is a regular on the list of most “business-friendly” states. There are many reasons for this; however, the experts typically focus on three of Nebraska’s natural advantages when it comes to business expansion or relocation: (1) energy availability, (2) central geographic location, and (3) a high-quality, dedicated, low-cost workforce. This trio of business-friendly attributes sums up the power of Nebraska.

is ideally suited for data center loads, especially large enterprise operations.

Workforce. The Cornhusker state’s workforce consists of productive, dependable, educated, and well-trained individuals who take pride in and care about the quality of their work.

Energy. NPPD and its public power partners have developed a large customer economic development incentive electric rate that offers energy at a discounted price for a fixed period of time. This rate

NPPD’s experienced Economic Development Team has assisted numerous companies in finding productive and profitable locations to do business in Nebraska. For more information visit econdev.nppd.com.

Geography. Nebraska’s central geographic location when compared to coastal areas is more shielded from natural disasters such as earthquakes, floods, and hurricanes.

2016 • 17

Redefining Continued from page 13

• Utilization of a standardized solution — This provides a framework for operations that can be scaled and allows maintenance to be easily performed and optimized.

• Marrying and optimizing the IT with infrastructure — This has become a major push in the data center design and market. Aside from mechanical and electrical infrastructure cost due to redundancy, if engineered systems can be installed that are “right sized” for only the power and cooling consumed by the IT equipment, the stranded capacity in anticipation of potential future IT compute can significantly be reduced, directly impacting the capital and operating costs. To effectively monitor the IT compute, there must be provisions to accommodate rapid implementation of the infrastructure.

• Reducing the power needed to cool the IT compute — This is leading to some very innovative

A Unique Southwestern Data Center

solutions, such as increasing the threshold temperatures the computers can withstand. Increasing the operating parameters of the servers has allowed development of innovative cooling systems.

What used to be a ratio of power required to power compute of more than two times can now be 40 percent lower. These efficiencies are gained through mechanical systems such as direct air-cooling, matching voltage utilization, and implementation of monitoring and controls that can align the operation of infrastructure with IT compute needs.

Because the refresh cycles of IT equipment are so fast, the infrastructure designs need to be more than the traditional reliability ratings that we have used for the past 25 years. We need to marry the resiliency based on factors such as business mission, impact on continuity, and alternative compute solutions. Although there are still data centers using a traditional approach to resiliency, the challenge before us is how we can provide the resiliency for the mission with lower cap ex and op ex costs by looking comprehensively at the TCO. Our need for more compute and storage will only increase, and developing the next innovation to meet this need will be exciting and challenging.

Bill Miller, Executive Director Reese Technology Center ••• 9801 Reese Blvd, Ste. 200 Lubbock, TX 79416 806-885-6592 Fax: 806-885-6003 bmiller@reesecenter.com www.ReeseCenter.com

Reese Technology Center is the Texas panhandle’s premier business and research park centered in education, engineering, technology, research, and light manufacturing.

Reese has positioned its facility to realize the utility of its assets, its customers, the synergy of related parties and interests, and its climate to become a leader in research for agriculture, wind research, energy development and management, and private-sector business development.

There is literally no other facility like it, particularly within the southwestern United States.

A secure private airfield, a data center with OC 192

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dataCENTERS

capability, standalone facilities of all sizes for lease, readily available office space for immediate occupancy, and a unique customer base make the Reese facility a premier site from which to grow a smaller business or sustain and evolve a large, mature business. From international industry leaders such as Vestas, Alstom, and General Electric to nationally recognized leaders such as Zachry, Wyle Aerospace, and Oxy USA to the National Institute for Renewable Energy and the National Wind Institute of Texas Tech University to small, entrepreneurial firms — all have recognized the value of being a customer of the Reese Technology Center.

FacilityLocations.com

Find the Right Location for Your Next Business Site, Facility or Headquarters FacilityLocations is a GIS map-driven, online economic development directory used to research potential locations during the business re-location or expansion process.

DISCOVER Search and identify potential site and facility locations within big, easy-to-navigate, GIS-driven maps

RESEARCH Drill-down into location profile pages: • Google Streetview and Bing Bird’s Eye Imagery • Heat Maps and Data Layers • Downloadable Point-and-Click Radius Demographics Reports • Available Property Listings and Key RE Assets

CONNECT A directory with 6000+ listings including: • Local and Regional Economic Development Contacts • Port Authority Contacts • Utility Contacts • Foreign Trade Zone Contacts • Foreign Inward Investment Contacts If you are an economic development agency and want to have an enhanced listing with a location profile on FacilityLocations.com, please contact Dennis Shea at 800.735.2732 x 208 or dshea@areadevelopment.com

SPEED IS MORE THAN A FEATURE,

IT’S A STRATEGY.

When you need a building now. We understand the urgency of growth. Every day we help brands like Walmart, FedEx, and Amazon expand their footprint with speed and fiscal accountability. When your organization is ready to expand—Fabcon Precast is ready to help you.

PRECAST WALL SYSTEMS - ENGINEERING - MANUFACTURING - INSTALLATION FABCONPRECAST.COM | 800-727-4444 ©2016 Fabcon Precast

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