{"id":1004164955,"date":"2017-01-24T09:08:32","date_gmt":"2017-01-24T17:08:32","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004164955"},"modified":"2022-12-08T17:24:41","modified_gmt":"2022-12-09T01:24:41","slug":"growing-cloud-fuels-data-center-boom-jll-report","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/growing-cloud-fuels-data-center-boom-jll-report\/","title":{"rendered":"Growing Cloud Fuels Data Center Boom: JLL Report"},"content":{"rendered":"

By Barbra Murray<\/p>\n

\"Bo<\/a>

Bo Bond, JLL’s co-lead for data center solutions<\/p><\/div>\n

The data center market is on fire, and it\u2019s getting cloudier out there. JLL just released its latest Data Center Outlook report, and demand continues to soar globally, due in no small part to the widespread transfer from corporate servers to the cloud.<\/p>\n

\u201cIn 2016, the data center market saw big deals from major players, new economic and regulatory policy, and the wild card that is strategic cloud adoption. These factors are changing the rules of the game, from data center pricing models to location selection tactics–and everything in between,\u201d according to the report.<\/p>\n

Data center users\u2019 attraction to the Internet of Things and cutting-edge technologies offered by the three major cloud computing providers–Amazon Web Services, Microsoft Azure and IBM–will only increase the cloud momentum. As a result, service providers in hub locations around the world will be compelled to expand. Some leading cloud providers, per the report, expect to triple infrastructure by 2020 in order to accommodate mounting demand.<\/p>\n

Activity in leasing is also being impacted by the cloud, which is sparking a change in data center footprints. As more five-year leases expire in 2017, users will have the option to move to cloud technology and restructure or right-size their colocation footprint. Regardless, leasing activity will continue on the upswing. In 2016, absorption hit record highs. In the U.S., the top 15 markets reached 357.5 megawatts, with Northern Virginia leading the pack–by a longshot. The suburban Washington, D.C. was also at the top of the list in 2015, but the numbers weren\u2019t quite as large. What a difference a year makes.<\/p>\n

\u201cThe biggest change since last year was the significant positive year-over-year absorption in Northern Virginia, Northern California and Chicago, coming from the growth of cloud providers and their hyper-scale requirements,\u201d Bo Bond, managing director and data center solutions co-lead with JLL, told Commercial Property Executive<\/em>. \u201cAbsorption in Northern Virginia grew from 63 MW in 2015 to 113 MW in 2016, Northern California grew from 38 MW to 59.1 MW and Chicago grew from 32.5 MW to 56 MW.\u201d<\/p>\n

\"Tysons<\/a>

Tysons Technology Center, Vienna, Va., recently acquired by a joint venture of Central Colo and Legacy Investing L.L.C. from The Meridian Group.<\/p><\/div>\n

While the data center market is on track to escalate further in 2017, there are definite changes ahead, as well as a few unknowns. Stricter data regulations are emerging, as is the case in Canada, where companies are mandated to store their data on Canadian soil, and in Russia, which is tightening its data sovereignty law. In Europe, only time will tell how Brexit will affect the industry, and in the U.S. the new presidential administration presents uncertainty.<\/p>\n

There are other trends on the horizon for 2017. As noted in the report., JLL expects that increasing M&A activity will \u201cdisrupt the playing field, while raising barriers to entry for newcomers to join the game.\u201d Retail pricing may become a thing of the past, as wholesale pricing becomes the norm. And investor appetite for data center REITs will only grow stronger, driven by this REIT niche\u2019s admirable average return on investment, which is generally in the 10-15 percent range.<\/p>\n

However, the big takeaway from the report circles back to growth. \u201cUser demand for smart data center solutions will only continue to heat up, with operators feeling the pressure to deliver more data, faster and more flexibly than ever,\u201d said\u00a0Jon\u00a0Meisel, managing director\u00a0and data center solutions market director with JLL, said in prepared remarks. \u201cSmart maneuvering will be necessary for users and operators alike to flourish in the coming months.\u201d<\/p>\n

 <\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

New challenges await, but the cloud will continue to accelerate demand this year. <\/p>\n","protected":false},"author":969,"featured_media":1004164956,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21755,23891],"tags":[32796],"class_list":["post-1004164955","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-data-centers","category-national","tag-jll"],"acf":[],"yoast_head":"\nGrowing Cloud Fuels Data Center Boom: JLL Report - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/growing-cloud-fuels-data-center-boom-jll-report\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Growing Cloud Fuels Data Center Boom: JLL Report\" \/>\n<meta property=\"og:description\" content=\"New challenges await, but the cloud will continue to accelerate demand this year.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/growing-cloud-fuels-data-center-boom-jll-report\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2017-01-24T17:08:32+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-12-09T01:24:41+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2017\/01\/Bo-Bond-JLL-courtesy-of-JLL.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"511\" \/>\n\t<meta property=\"og:image:height\" content=\"600\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Barbra Murray\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/growing-cloud-fuels-data-center-boom-jll-report\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/growing-cloud-fuels-data-center-boom-jll-report\/\",\"name\":\"Growing Cloud Fuels Data Center Boom: JLL Report - 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