A few months after starting construction on two data centers at its Northern Virginia and Silicon Valley campuses, Vantage Data Centers might be preparing for another expansion. The company has paid $40 million for a 113,600-square-foot property at 2590 Walsh Ave. in Santa Clara, Calif., through Vantage Data Centers CA31 LLC, according to public records. The previous owner was D.R. Stephens & Co., according to CommercialEdge, and the office/flex industrial asset last changed hands in 2007 for 14.3 million.
The single-story building came online in 1981 on a 6.7-acre parcel, featuring a mix of office, warehouse and manufacturing space, as well as a parking ratio of 3 spaces per 1,000 square feet. However, the existing structure might end up demolished if Vantage is to make the property a starting point for a third Santa Clara campus, as the buyer LLC’s name could suggest. Vantage representatives did not immediately reply to a request for additional details.
Located some 2 miles northwest of downtown Santa Clara, the property is within walking distance of two Vantage data center facilities at 2565 and 2625 Walsh Ave. that Facebook leased in February 2020, according to The Mercury News. That deal also included three similar buildings at 2480, 2880, and 2820 Northwestern Parkway, also part of Vantage’s Santa Clara CA1 campus.
Further up the road is the 8-acre site of a planned, 430,000-square-foot data center of Digital Realty. The company intends to develop the facility, an addition to its Santa Clara connected campus, in partnership with local real estate firm Pelio & Associates.
A data center boom
The COVID-19 pandemic generated increased demand for online services and data centers felt the strain on the existing infrastructure. Trying to keep up with demand, data center owners accelerated the expansion, especially in the first half of 2020, according to a CBRE report. Silicon Valley had 24.6 MW of capacity under construction at the time, while total developments across primary markets reached 373.6 MW.
Data center activity in 2021 will, most likely, follow the same trends. Lee Kestler, chief commercial officer at Vantage Data Centers, told Commercial Property Executive that the main challenge will depend on how quickly and efficiently operators can keep up with demand. Kestler also stated the company will continue to eye North America and Europe for future expansion.