There are thousands of data centers scattered across the globe, but there’s something different about the new locations springing up these days. More often than not, they now include multiple data center buildings rather than just one. Michael Nudelman, SVP of project development at CyrusOne, told Silverlinings that’s because hyperscalers are looking to future-proof their infrastructure.
“If you think about the evolution of the colocation data center business, if you look back maybe 5, 7, 10 years ago, most of the companies they were focusing on single building development,” he said. “Nowadays most of the development for hyperscale and wholesale companies like CyrusOne, it’s campus development where you have a number of buildings being developed in a single location.”
According to Nudelman, the shift toward campus-style developments creates economies of scale that benefit customers. It also allows customers like hyperscalers to “land and expand” in key locations, providing a long runway in terms of capacity expansion.
But, of course, these kinds of campus projects require two key things: land and power. So, for instance, if you’re wondering why Amazon is scooping up hundreds of acres at a clip in Ohio, there’s your answer.
Luke Kipfer, VP of Data Center Development and Construction for new data center builder PowerHouse Data Centers, also highlighted the growing size of data center campuses in a previous conversation with Silverlinings. He said the smallest site these days is around 10 acres, while all of the ones it is looking at for the future are 100 acres or more.
Both real estate and power availability, Nudelman said, factor in to CyrusOne’s site selection process and total cost of ownership calculation.
On the power front, Nudelman said there are two considerations. There’s the power infrastructure itself – the physical lines used to transmit electricity to a data center – and the source of the power flowing over those lines.
While smaller-scale data centers can use medium voltage power infrastructure, hyperscale campus developments require access to transmission-level power. This means CyrusOne and data center rivals like Equinix, Digital Realty, CoreSite and more have to coordinate with utilities to determine timelines for construction and delivery of those lines and substations.
The other area of focus is ensuring the electricity flowing to data centers is coming from carbon neutral sources. According to its most recent sustainability report, CyrusOne was able to source more than half of the electricity powering its facilities from zero-carbo renewable sources in 2022.
CyrusOne went private after being acquired by private investment firms KKR and Global Infrastructure Partners last year. Nudelman said CyrusOne is planning a rapid expansion of its data center footprint but declined to provide specific growth targets. A company spokesperson said "the number of new locations/projects is based on customer demand such as their recent announcement of their JV with Kepco in Japan." CyrusOne currently has more than 50 facilities worldwide, including in North American and Europe, and recently expanded into Asia.
“CyrusOne at this moment is very active across all the markets in terms of site selection, development and construction, and we are expanding rapidly our portfolio of sites,” he concluded.
6/6/2023 11:09 AM ET: This story has been updated to correct Nudelman's title. He is SVP of project development, not product development.