Houston Data Center Construction Gains Momentum

Houston data center construction ramped up in 2018, with a major prelease by an Australian oil and gas company driving the additions to the market, according to a CBRE report.

DownUnder GeoSolutions signed up for an initial 15 megawatts of power at a new computing center at Skybox Datacenters in Katy. The project, which represents one of the largest deals in the U.S. in 2018, is among 23 megawatts of electrical capacity under construction in the Houston area, according to CBRE.

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The local market experienced 3.3 megawatts of net absorption in 2018, which is in line with historical averages, according to CBRE. Houston's data center inventory totaled 112.9 megawatts, unchanged for the year. Of that, 29.1 megawatts or 25.8 percent is vacant.

Dallas, one of seven primary markets for data centers, has 301 megawatts inventory and a vacancy rate of 21.5 percent. Austin/San Antonio has 150 megawatts and a vacancy rate of 4.5 percent.

Absorption in the seven primary data center markets across the country reached a record 303 megawatts in 2018 on demand from from hyperscale cloud providers, according to CBRE. Northern Virginia accounted for two-thirds of the construction activity in 2018.

"We are closely watching supply and demand trends across the U.S. data-center market in 2019 and beyond, particularly as data consumption—driven by the adoption of big-data analytics, 5G, gaming, streaming services, edge computing and the internet of things—continues to drive growth," Pat Lynch, senior managing director, Data Center Solutions, CBRE, said in an announcement. "Meanwhile, we've seen robust construction activity as operators try to position themselves to rapidly deliver facilities within users' often-tight schedules."

Source: Houston Chronicle