Data Center Demand Is Soaring. Experienced Contractors With Local Expertise Are The Keys To Meeting That Demand
The demand for data centers is on the rise. CBRE senior economic adviser Spencer Levy told CNBC in March that 2021 could be a record year for data centers, with more acceleration to follow. Meanwhile, a global data center construction market report released in December predicted the data center construction market will expand at a compound annual growth rate of 6.4% from 2020 to 2027.
With so much growth on the horizon, the time is ripe for construction firms with experience building data centers. But finding contractors who are skilled in the unique, complicated aspects of mission-critical construction — and have the local connections to make sure the job gets done right — can be easier said than done.
“In the data center world, electrical drives everything,” Truebeck Construction MEP Executive Ben Hancock said. “You have millions of dollars that goes into electrical switchgears and cabling and other parts and pieces that make up the system, so you need to make sure you’re working with the right MEP experts.”
He added that along with finding top local mechanical, electrical and plumbing contractors, data center owners need to find highly skilled operations personnel who understand the complex cooling needs of these facilities. The servers that data centers house create massive heat loads, and without the right HVAC system in place, there is a risk that they could overheat and crash.
Truebeck Chief Estimator Todd Ahern said that because these facilities must be constructed by highly qualified technical builders, finding enough skilled subcontractors to create healthy competition for a job can be a challenge. That challenge is best managed by a contractor with extensive local expertise. Truebeck’s team has built strong relationships with skilled MEP contractors throughout the West Coast, where they operate, to make sure the best trade partners are selected for every project and to ensure the build is quick and cost-effective.
Ahern said that when it comes to picking trade partners for a project, Truebeck is able to pull from a wide pool of local talent. Truebeck leaders know who can bring the most value to a project, both in terms of skill and cost, and clients can feel confident that they will be able to deliver the highest-quality product. Without this local knowledge and time spent fostering strong relationships, out-of-area general contractors often struggle on this front.
“When you’re talking about exceptionally large data centers, there's really only, in some instances, a handful of electricians that could handle something that size,” Ahern said. “What our team will do in these cases is look for ways to parse out the work to make it accessible to more contractors and provide the best value to our clients.”
He added that Truebeck's understanding of the area extends beyond relationships with contractors. The company also has a broad understanding of local laws and regulations and, just as importantly, strong relationships with the people responsible for crafting those regulations and giving out permits. Out-of-area builders may not have these types of relationships and could end up tied down in red tape.
All of this happens in the pre-construction phase, which is something Truebeck specializes in. Truebeck’s dedicated pre-construction team works directly with its operations team to vet every subcontractor and eliminate any scope gaps.
“It's a truly integrated process,” Truebeck Project Executive Christine Zinkgraf said. “We’re not operating in silos.”
Truebeck Senior Project Executive Cory Keller said that the key to finding the right subcontractors and putting together the best operations plan for a mission-critical project is to understand the data center owner and what its requirements are: Is it looking for the lowest price of entry? Is it looking for the fastest schedule? Does it already have a user for the data center space? All of that, he said, will help dictate the project from a design and construction perspective.
The other key to a successful project, Hancock said, is for owners and developers to get the Truebeck team involved as early as possible in the planning stages.
He told a story of one client who Truebeck had previously worked with that came to the firm looking to expand its data center campus to accommodate a new user. The client wanted to take a design-build approach and engaged Truebeck early on to get its opinion on the best way to move forward. Truebeck’s team looked at all the opportunities on the client’s current campus but also explored outside properties to determine what made the most sense from both an economic and timeline standpoint.
In the end, Truebeck determined that building something on the client’s existing campus was the most efficient plan that would lead to the most efficient speed to market.
“With a lot of jobs like this, we’re working with clients in occupied, mission-critical spaces, so we need to minimize downtime as much as possible and, ideally, there should be zero downtime,” Zinkgraf said. “We’re very sensitive to that challenge and view it as a way to provide a higher level of service.”
She added that Truebeck has a robust pre-construction team, so when a client comes with a highly conceptual project in the early stages, Truebeck is able to help work through the potential designs and pricing options.
“Building data centers can be incredibly challenging,” Ahern said. “We have the in-house pre-construction and MEP expertise and the local industry contacts to get projects done fast and efficiently.”
This article was produced in collaboration between Truebeck Construction and Studio B. Bisnow news staff was not involved in the production of this content.
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