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Commercial Real Estate

CBRE: Robust Demand For DFW Data Center Space

As new projects begin to come online later this year and into 2017, competition among providers will increase.
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North Texas data centers saw record-breaking activity in 2015, leading into a strong first half of 2016, according to CBRE Research’s second-quarter national data center report. The firm says cloud service providers (CSPs) have seen significant demand, with enterprise users adopting cloud storage at a faster rate than anticipated.

Total net absorption in Dallas-Fort Worth for the first half of 2016 came in at 6.7 megawatts. Vacancy rates dropped to 20.5 percent at the mid-year point, down from 22.5 percent at the end of 2015.

Delivery of new supply will be a big factor over the next 18 months. CBRE is currently tracking 730,000 square feet and 49 megawatts of wholesale colocation product under construction, with projects set to deliver in the next three to 12 months.

As new projects begin to come online later this year and into 2017, competition among providers will increase—especially for anchor tenants for new projects.

Haynes Strader Jr. with CBRE’s Data Center Solutions Group said he expects data center absorption to pick up significantly over the next several months. “This is as an opportune time for users and tenants to exercise the competitive nature of the Dallas market to drive pricing and terms in their favor,” he said.

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