For the data center industry, the theme of 2020 has been “more.” Stay-at-home orders and millions of Americans working from home during the coronavirus pandemic led to an immediate demand for enhanced digital connectivity. As a result, the need for reliable data centers that can help people stay connected has skyrocketed.

Pair the current need with the fact that demand for data centers in North America is expected to double in the next five years, and it becomes clear that developers need to construct more of these facilities, fast.

“As the size and scale of data center developments evolve, the process in which they are built needs to evolve as well,” said Ryan McGuire, executive vice president at Clayco, a design-build construction firm that has been constructing data centers using modular construction methods. “The goal is to reduce the time to plan, design, build and commission them, and you can accomplish that with off-site and modular construction methods.”

Instead of constructing an entire building on-site, a modular construction approach means portions of a project can be fabricated off-site and then delivered. Modular building has been shown to cut down costs and speed up construction timelines by 20% to 50%. McGuire believes this is just what the booming data industry needs to meet accelerating user demand. Bisnow spoke with him to learn more about the future of the data center industry and the role modular construction will play in it.

Bisnow: What are some of the main challenges data center developers face? 

McGuire: Data centers have evolved from stand-alone facilities supporting individual business entities to regionally diverse hyperscale developments. Rocketing cloud demand, 5G and the Internet of Things are driving robust investment in data centers, and with a rapid increase in demand, data center developers have a lot of promises to keep. To stay competitive, developers need to prioritize speed-to-market at a lower cost per megawatt, and they also need to meet continuously expanding sustainability goals. All of this can be accomplished through modular construction.

Quality control and reliability are paramount. Data center developers need assurance their pipelines can be built safely, efficiently and at an incredible pace in multiple diverse geographies. However, a dwindling skilled workforce, a lack of reliable power sources and significant environmental considerations are all standing in developers’ way.

Bisnow: What are the benefits of choosing modular construction for data center development? 

McGuire: In addition to the more well-known advantages often cited with off-site modular construction, like accelerated timelines, quality and safety benefits, one of the most promising benefits of modular construction is the potential to de-risk the labor pool.

The largest data center campuses are frequently built in locations where land, fiber and power affordability are most available. These areas tend to have smaller population centers and require outside labor forces to deliver projects since it can take 1,000 or more skilled tradesmen and women to deliver a single hyperscale project.

With an estimated 430,000 unfilled construction jobs nationwide and an aging workforce that sees more retirees each year than new apprentices to take their place, the skilled labor challenge in the supply chain is very real. COVID-19 has only accelerated these concerns. Off-site construction dramatically reduces the on-site labor requirements for these projects; since you don’t have to just rely on the local workforce, parts can be made off-site and shipped to the project site from anywhere.

Bisnow: Why has modular not caught on yet, and why is now the time? What pieces of the data center building can be prefabricated?

McGuire: I believe it has caught on. If you’re not thinking about prefabrication today in the data center market, you are likely behind the curve. Compared to other industries, the data center industry is still experiencing some communication issues in the supply chain that need to be solved to make prefabrication process happen more smoothly, but it’s quickly catching up.

There is a way to prefabricate just about any part of a data center today, but just because something can be prefabricated doesn’t mean that’s always the right answer. The right answer depends on the provider’s business model, supply chain management and a study on scale and repeatability. Common components we are already prefabricating include modular electric rooms and utility systems, underground duct banks, exterior walls and structures and interior systems like hot aisle containment and overhead mechanical, electrical and plumbing. We continue to study more opportunities with our clients, trade partners and equipment providers.

Bisnow: Where do you see the demand for data centers headed in the future?

McGuire: Most research shows the data center market continuing to grow significantly and we agree. I can’t tell you the number of requests for proposals we’ve received from current and potential clients in the last few months or where those projects are going to be, but I can tell you we are busier than ever with no signs of slowing down.

This feature was produced in collaboration between the Bisnow Branded Content Studio and Clayco. Bisnow news staff was not involved in the production of this content.