DEMAND UP FOR DATA CENTERS

January 4, 2010 | 7:00 am ET Staff Reporter

One carryover trend from ’09: plentiful space for any kind of business. Eg, JLL's Mission Critical Solutions, which mostly handles site selection transactions, is leasing 477k SF 2323 Bryan St downtown on behalf of Digital Realty Trust, a wholesale provider of data centers.

JLL’s Brian Oley tells us demand for these centers is increasing, while supply is a little shy to adjust because financing is hard thanks to dot bomb days. JLL's Mission Critical Systems (based in Dallas, with 45 group members globally) has executed about 600 megawatts worth of transactions in data centers. (We’re not good with conversions, so let’s just say that’s 8 tablespoons.) Because of the lack of supply potential, firms needing space are turning to co-location and paying a premium for it. Brian dubs this a "band-aid" and notes that even the supply of solid co-location space is scarce, in some cases leased before it’s even built.

MCS reps clients like Microsoft and Bank of America and is also listing this space, for the former Yahoo! DC 002 at 2914 Taylor St in Deep Ellum. Brian says Tier1 Research shows the global supply for data centers increased 6% in the past year, failing to keep pace with the 14% increase in demand. Most research publications following the industry show that gap continuing to widen in the next five years.

Bisnow caught up with Brian, Jan Lighty, and Josh Foxwell at the JLL Dallas office. Brian (with help from his wife) has a baby boy due Feb. 1. Already named Jude, it’s a hat tip to St. Jude Children’s Research Hospital. Brian and his wife serve on the hospital's Next Generation Committee and co-founded the Dallas Chapter of the Friends of St. Jude Young Professionals Group. On Feb. 18, look for a fundraiser photography art show in a vacant retail space downtown across the street from Neiman Marcus.