Real Estate's Cloudy Picture
Data centers are big business in DC real estate, which is why we held our Bisnow annual national Data Center Investment Conference and Expo (acronyn: DICE) this week in Crystal City. Will the cloud keep expanding the need for these behemoth buildings?
Before 500 over two days at the Renaissance Capital View in Crystal City, CapitalOne facilities chief John McCullen said that while putting bank data on a public cloud is attractive, security concerns are holding it back. Since CapitalOne holds so much personal information—and given the recent data breaches like at Target—the bank is choosing to keep its data private, for now. To better control its data, John says CapitalOne won't go to a co-location data center (think multi-tenant).
GEICO (its facilities director Derrick Milliard, left, with Sutherland's Rob Plowden) employs the same approach to data control, for the simple reason that the firm isn't strapped for cash. Since it can afford to buy, build, and manage its own data centers, GEICO doesn't have to worry about risking its proprietary data on a public cloud.
Since GEICO is the No. 2 US auto-insurer, Derrick also worries whether cloud computing can keep up with the firm's growth: "Power, location, and real estate are not concerns, but security is. Can the cloud keep pace with our demands?" he asks.
Northern Virginia is still one of the "big six" markets for data centers, says 451 Research whiz Katie Broderick, here with CBRE's Tom Cleaver. It's joined by the NYC metro area, Silicon Valley, Chicago, Los Angeles, and Dallas. NoVa and New York add about 400k SF of new data centers per year, while a secondary market like Tampa or Austin add about 200k SF. We'll have more DICE coverage on Monday.