In our Data Center Destinations series, From the Racks takes a look at locations that are thriving hubs for data center innovation and construction. These places are grabbing the attention of data center providers and enterprises.
What’s Driving Demand?
Because it is the third largest city in the U.S. and serves as headquarters for several Fortune 500 companies, it’s not a surprise that Chicago is a featured data center destination. And with so many large industries thriving in the area (e.g. financial services, telecom, healthcare, insurance, tech, etc.), minimal latency is a necessity. This, in turn, is driving both downtown and suburban expansion for data centers.
In fact, Data Center Hawk notes that 2016 absorption rates in Chicago were significantly higher than those of other leading metropolitan areas in the country, indicating a highly active and competitive market for data center construction.
According to Data Center Dynamics, “Data center providers are betting big on future Chicago demand despite their conservative delivery approach with new capacity. Several large-scale projects are under construction right now, many on campuses with additional land for further growth.”
Some of these projects include DFT’s 305,000 square-foot CH3 facility currently being constructed in Elk Grove, Illinois, that promises 25.6 MW of capacity.
Large, established companies looking to expand their existing data centers as well as budding, data-driven companies that understand the need for agile data storage and computing capabilities can benefit from the Chicago data center landscape.
Larger enterprises that need to minimize latency as much as possible may find more expensive downtown locations to be the best fit, while companies looking to expand more affordably may seek out data center sites in surrounding Chicago suburbs. In a way, there is a data center environment that suits most interested parties.
The business climate in Chicago also favors data center development, as business leaders appreciate the need for a scalable, operational cloud offering - something heavily supported by powerful data centers. In addition, increases in private sector jobs are driving growth in the data center market and indicate a generally booming business community.
Chicago’s central location, fiber abundance and easy access to internet exchange points (IXPs) also strengthen its connectivity profile. The Greater Chicago area serves as a content delivery hub for a large portion of the American Midwest and an ideal location for major enterprise headquarters, continuing to feed that important business environment.
Other advantages in the Chicago data center market include relatively low power costs, compared to other areas of the country, as well as a low risk of natural disasters. In fact, power costs are further reduced because Chicago has an average of 300 days per year that are cool enough to pipe outside air into a data center, essentially providing “free cooling.” Both of these results in significant energy and operational cost savings for data center providers.
Embracing Data Center Expansion
Chicago continues to encourage data center expansion in the area. This is well-illustrated through the establishment of the Data Center Express program in 2012, a partnership between the City of Chicago, the World Business Chicago trade group and local electricity provider Commonwealth Edison. The program helps data center providers navigate through the building process by providing a single point of contact within the city.
The city of Chicago offers not only a healthy, thriving business community that’s ripe for data center expansion, but also a support system and reliable connectivity to make that expansion possible.
For more information about DFT’s new CH3 data center coming soon in Elk Grove Village, click here.