DATA CENTERS GO SPEC IN THE 'BURBS

Of the nine countries where Digital Realty Trust operates, its largest data center is in Chicago (1.1M SF at 350 E Cermak). It likes this market so much that it's now expanding into the ‘burbs, building a rare spec project. (The Fabergé egg of the CRE world.)
 
DLR SVP of asset management Dave Caron (here with colleague Bob Holmes) tells us that the company paid $22.3M for an industrial property in Franklin. It will probably spend another $80M or so to re-developit into a three-building data center complex and expects to start construction soon. Dave says DLR would only consider spec projects in a few other markets, like Boston, New Jersey, Northern Virginia, Dallas, Santa Clara, and the Bay Area. It’s taking the plunge here since Chicago is a major financial center with several corporate HQs that have huge data needs.
 
At the Franklin data complex, to be known as Digital Chicago, the interior design and engineering work is well under way. Site work and groundbreaking will start in a few months. Delivery of the property (10 miles southeast of O’Hare) is expected by mid-’13. Dave expects space to be leased to some of the area’s major corps and to cloud providers and their users. The Cermak property, DLR's flagship data center (and the world’s largest), is an Internet gateway. It's 100% occupied, up from 85% when DLR bought it in ’06. The company's other area data center is 600 S Federal St in downtown Chicago, another Internet gateway populated with major telco carriers. 

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