As our world digitizes, the data center industry has experienced unprecedented growth, putting pressure on owners to “future-ready” their white space.
The necessity for increased use of digital technologies to support new ways of working, communicating and doing business has greatly increased our day-to-day and even minute-to-minute reliance on data centers. Key drivers include the following:
- Internet of Things (IoT) convergence
Home, smart building, industry 4.0 - Content delivery
Video conferencing, streaming, social media, cloud apps, gaming Disruptive models - Bitcoin, blockchain, vehicle sharing
Exponential Growth
The demand for compute capacity has increased exponentially. Driven by cloud compute services, there is unprecedented pressure on colocation providers and hyperscalers to provide capacity across existing and emerging markets.
Cloud demand, driven by pandemic-related changes in virtual work requirements, have fueled the record levels of uptake, but the significant factor is the amount being pre-let. The market used to see 2-3MW deals at a time and now sees 20-30MW deals happening, which is also fueling a new build-to-suit market aimed solely at the cloud service providers (CSPs).
Cloud service providers want this increased capacity in metro locations, and they want it delivered as quickly as possible, driving developers to accelerated construction schedules with penalties for late delivery. Accelerated construction schedules mean standardization, prefabrication and modularization, and this is the same for the tenant’s white space fit out.
Scalability and Standardization
Building at scale and at speed requires standardization of design, process and supply chain. Global CSPs are now trying to execute in local markets, and growth and expansion from Tier 1 into the newer Tier 2 & 3 markets may also mean dealing with new colocation providers to meet the ever-increasing demand.
CSPs want speed to market, high quality and consistency at a reduced price point through any deployment, anywhere in the world. This is driving a need for global partnerships and supply chains—from manufacturers to installers that can scale with their needs. Colocation providers need the same support to help navigate expansion into new markets.
Global design standards don’t always translate into perfect execution in local markets, with unique electrical and fire regulations in each region, and so familiarity with both their design and localization of their designs is crucial.
White Space Strategy
With this industry growth, data center owners and operators need to have a white space strategy to ensure their facilities are future-ready. When developing this strategy, there are key considerations to weigh:
Migration strategy: It’s important to think about what migration will look like in the beginning of your process to ensure it does not affect the reliability of the live data center. As it’s a balance between cost, time and risk, the owner’s goals and ultimate purpose of the data center need to be included in the strategy.
Scalability: The white space in a data center is typically upgraded every 5-10 years, and using a global supply chain will usually ensure more advantageous pricing and payment terms than an individual owner can secure. Even the smallest customers will see cost and consistency benefits from having access to a global supply chain.
Speed to market: Having access to a global supply chain and an ability to optimize product lead times will greatly impact the speed to market of the white space and the deployment of the IT equipment and, for the customer, the realization of economies of scale.
The standardization and layout of the white space has evolved substantially since the introduction of data centers as we know them today—from a room full of mismatched equipment on a carpeted floor to a globally streamlined set of equipment in a regulated space. Ongoing improvements occur to white space standardization and layouts with each new technology, sustainability requirement or design strategy that is introduced.
Today, fit out strategies focus heavily on three key areas:
Risk management: For sites that are live, risk management plays a crucial role to ensure that the reconfiguration does not impact the live data center’s reliability. Coordinating with all stakeholders can help account for resiliency, redundancy, service level agreements and site constraint risks
Consistency: This shift toward consistent sites enables owners to have the same look and feel across all their data centers. For example, consistency involves using the same suppliers for cabinets, structured cabling and fiber in addition to having all supply and buying decisions made once globally rather than many times locally. Therefore, having global vendor connections ensures best pricing, coverage, supply and priority in all of the regions where the owner expects to grow. Additionally, having a global vendor network helps define best practices based on what’s available and achievable globally while meeting regional building and environmental codes.
Timing: There is pressure from the end user as well as the owner for fitting out data centers on time and efficiently. As described above, data center space can’t deliver too fast for the market. Delivering space on time is crucial to keeping up with demand. From an owner perspective, the faster their space is ready, the faster they can start charging occupiers. To maximize time for an existing site, once the owner is presented with the keys to their space, the owner should be able to have the space immediately fit out. To read more about white space strategy, including regional trends and considerations for every stage of the data center lifecycle, visit CBRE Data Center Solutions’ thought leadership hub at cbre.com/uptime
