Browse Tag: data centers

Adaptive Reuse: From Newspaper Printing Plant To Data Center

picture of QTS Chicago data center
QTS Chicago Data Center.

Gail Kalinoski’s piece in Commercial Property Executive focuses on a big adaptive reuse story in Chicago. At 317,000 SF, the Chicago Sun-Times newspaper built for the future, but not the future of newsprint.  Its printing presses fell largely silent and its need for logistics fell away as demand for daily news printed on paper was obliterated by the world wide web.

Built in 1999 and shuttered twelve years later, the facility is seeing new economic life ironically by giving shelter to the very technology that closed the property at first. The plant is now a thriving data center, still dedicated to distributing information, albeit bits and bytes.

Owned by QTS Realty Trust, an international operator of data centers, the building went through a reported $80M retrofit to make the conversion from distributor of dead trees to modern computing marvel:

The first phase has been completed and features 48,000 square feet of raised floor and associated critical power. When fully developed, the building will support a total of 133,000 square feet of raised floor encompassing 24 megawatts of power. QTS said it has the ability to add 213,000 square feet of raised floor and 32 megawatts in Building 2 for a total of 346,000 square feet of raised floor and 56 megawatts of power within the campus at 2800 S. Ashland Ave.

The company is planning an open house on July 15 to showcase the Phase One completion.

“We are pleased to formally open our new Chicago data center that extends our platform delivering a broad selection of integrated IT infrastructure services for Chicago and nationally,” Dan Bennewitz, COO of sales and marketing at QTS, said in a prepared statement. “We are focused on a collaborative, high-touch enterprise approach serving the dynamic needs of today’s agile enterprises seeking a partner that can right-size flexible and scalable IT solutions for today and tomorrow.”

Data Center Retrofit? The First 13 Questions To Ask

Hutto Co-Op - Interior 3

The continued revolution in distance working / telecommuting is fundamentally altering commercial real estate’s traditional office space measures of economic health.  Once, vacancy rates and square footage outlays per employee were widely assumed key indicators of performance.  Today, the economic power of the office worker is being spread out around the globe.  This is contributing to stubborn vacancy rates, but it is also driving explosive demand for data centers.

Found in your client’s portfolios is probably vacant space aplenty.  Can any of that space be retrofitted into a data center?  Complicated topic, as the questions could be endless.  But you have to start somewhere — here are the first thirteen questions to ask:

  • Is the area isolated from contaminants and liquid leaks?
  • What is the general layout of the area?
  • Is there enough room for required equipment?
  • Is there adequate access for moving in and rotating large equipment?
  • What is the proximity of the area to chillers and condenser units?
  • Where will HVAC units be placed? Inside the area? Outside?
  • What are the access control possibilities?
  • Is there any room for future expansion?
  • Can walls be removed without creating structural instability?
  • Can walls be added?
  • Can a raised floor be added?
  • Is the floor-to-ceiling height adequate for a raised floor, ceiling plenum, and equipment height?
  • Will the existing subfloor be able to handle the weight load?

What Does It Mean On The Ground When Netflix Moves To The Cloud?

Image representing Netflix as depicted in Crun...

Staying informed about the operations space needs of technology companies gets harder as technology evolves.  Let’s take a look at a recent announcement for a recognized tech brand and try to process what it means in terms of commercial real estate and data center space.

Netflix is a movie rental and media powerhouse that has, over the past few years, moved the bulk of its business from DVD rentals-by-mail to streaming movies across the internet on a subscription basis. In an announcement today, the company said it was going to “gut” its data center and shift its operations to “the cloud”.

Netflix no longer wants to run a data center in support of its in-house corporate IT services. It is shifting internal applications to Amazon’s cloud, as well as using software-as-a-service (SaaS) providers for business services.

Mike Kail, vice president of IT operations at Netflix, said he wants to move as much as 95% of Netflix’s corporate IT services, now run in an in-house data center, to the cloud, but the goal is 100%, he said.

These corporate IT operations are separate from the Netflix streaming service, which operates from Amazon’s cloud.

The intent is to focus IT operations on providing services to the business, and not managing hardware, said Kail. “Part of my charter is to reduce my data center footprint as much as possible,” he said.

The bolding above is mine.  I point it out because this affects Netflix’s floor space requirements radically going forward. In order to operate — that’s just internal operations, not even counting the need to send streamed movies to customers —  Netflix has until now needed to operate thousands of servers – about 2,500 are mentioned in the piece.  Operation of rack after rack of servers means heavy duty power, cooling, physical security, redundancy and scaling all needed to be carried on Netflix’s commercial property portfolio as an irreducible cost of doing business.

Technology has a funny way of redefining the word “irreducible”.  With the announcement, Netflix has become an even bigger customer of its cloud provider, Amazon.  This means Netflix no longer needs the physical space they once did, and the accompanying reduction in square footage comes off of their books in the near future.

But where does it go?

No Magic In Data Centers

The fact is those 2,500 servers Netflix will soon no longer need to put a roof over represents a data processing capacity that endures beyond the deal.  That capacity is what is moving from Netflix to Amazon.  Which means that in terms of commercial square footage, Netflix’s decline in demand is now Amazon’s rise in demand.  Not necessarily at a 1:1 ratio, but not terribly far away.  No matter what, when data needs processing, the hard requirements never omit space, power, security, scalability and redundancy.

Amazon’s cloud services are growing in space need roughly at the minimum rate corporate property owners who are reducing their footprint like Neflix are jettisoning square footage.  I say minimum, because much of the business Amazon sees is not conversions/migrations from existing, owned data centers, but rather enterprises that were born using cloud computing service and will likely not use another method in the foreseeable future.

Amazon has physical facilities in at least a dozen locations worldwide and they are but a single player in the cloud business.  Consumers of data center square footage are proliferating, driven by the shifts toward cloud computing.

So the next time you see a story where a company has discontinued its data center, remember that computing capacity has to go somewhere.  Demand for space didn’t evaporate into the cloud — it only moved to another location.


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Modular Construction: New Commercial Property Applications

(Photo credit: psd)

If there’s one common thread to the huge number of different technological changes roiling commercial real estate, it’s standardization.  Standardization looks for ways to treat different things in the same way, and build efficiencies as a result.  Standardization is behind all the software tools we use and increasingly depend upon – the web, your desktop, your phone, all need to run the application you need.  The listings data you depend upon has to meet certain standardized criteria or it won’t publish.  In finance, standardization of debt instruments gives us CMBS and other tools to increase credit and liquidity (sometimes too much!)

Standardization is also the enabler behind prefab (aka modular) construction.  Long a fixture in single-family residential, the practice of assembling major building components off-site has not been as historically popular in commercial construction projects, accounting for only 1% of US building market, generally limited to schools, hospitals, dormitories and some retail stores.  But that is changing as technology continues its inexorable march and commercial property developers look to squeeze every dime until it hollers.

The trade group Modular Building Institute says the market in modular construction for commercial buldings is set to increase over the next five years.  I took a look at hotels and data centers and found trends that support this idea.


This neat animated video walk-through of a single hotel project utilizing modular construction techniques, details various measures of efficiency for construction schedules as the project gets built (mostly under a factory roof, down to the floor tile and wall treatments.)

Data Centers

Customization – the mortal enemy of standardization – is costly in the building of data centers.  It is falling by the wayside in the provisioning of multi-tenant data centers (MTDC) that rely on standardization of space along with its critical cooling, access and power requirements.  These packaging techniques for space afford tenants the ability to scale their square footage as their growth demands  — as opposed to the maximum that the landlord would traditionally prefer to rent.

The prefabricated, modular data center promises to have a major impact on the economics and technology of this still-nascent commercial property industry.  For all the same reasons that prefab is attractive elsewhere — efficiency, cost control, and the avbility to leverage real-world business metrics in space provisioning.

An excellent white paper detailing the impacts of prefab construction and provisioning is “Data Center 2.0: The Industrial Evolution”, provided by data center vendor IO.  Download the full paper here.