The Dallas/Fort Worth Data Center Market

The Dallas/Fort Worth Data Center Market

The Dallas/Fort Worth (DFW) data center market has grown steadily over the past five years. Demand in the DFW market often originates from companies with a large presence in the area. However, many companies outside the area evaluating the DFW market find it appealing. Most companies go to Texas due to the state's central location, affordable real estate prices, and aggressive tax incentives.

The DFW area in particular has a diversified labor force, with strong growth recently from the technology and services industries. The initial growth of DFW's data center market originated in the downtown area of Dallas. Because the downtown area is rich in telecommunication infrastructure, several office buildings were retrofit to accommodate data center users. Data center growth in Dallas traditionally comes from financial, technology, managed services/cloud, telecommunications, and the healthcare industry.

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Power Overview

Texas is unique in that it is decoupled from the interconnected power grids serving the eastern and western United States. Among the contiguous 48 states, Texas is the only one that has a standalone electric grid entirely within the state. This means that with few exceptions, Texas produces the electricity consumed within its borders and therefore is not subject to the Federal Power Act, a Depression-era law where the Federal Power Commission oversees all interstate electricity sales. The Electric Reliability Council of Texas ( ERCOT), a nonprofit corporation governed by a board of directors and subject to oversight by the Public Utility Commission of Texas and the Texas Legislature, is responsible for managing 90% of the electricity in the state of Texas.

Connectivity Overview

Multiple carriers' fiber networks blanket the DFW Metroplex connected to a robust last-mile infrastructure. Alpheus (a regional fiberprovider based in Texas), CenturyLink, Cogent, EarthLink, FiberLight (another regional player based in Atlanta, GA), Level 3, Sprint, Verizon, Windstream, and XO all serve the Metroplex. Long-haul fiber from multiple carriers connect the urban centers of both Ft. Worth and Dallas. Telecom giant AT&T relocated their world headquarters to downtown Dallas in 2008 and the company's long-haul fiber is prevalent in DFW. AT&T fiber runs through the Alliance Airport area (home to the new Facebook data center) south to downtown Ft. Worth, then west to downtown Dallas, and winds up into the northern suburbs of Carrollton and Lewisville—an area with several large colocation data centers. To the east in Dallas' northern suburbs of Richardson and Plano, enterprise-grade fiber infrastructure attracted the majority of DFW's new data center construction in the past five years.

Hazard Risk Overview

Despite being relatively free of natural disasters, new entrants to the Dallas/Fort Worth market can sometimes worry about tornado risk. In addition, small earthquakes that have rattled the market recently have raised safety concerns. Data center providers in DFW know to address these concerns by designing facilities that meet building codes and withstand seasonal bouts of high-powered winds .

Dallas/Fort Worth DATA CENTER MARKET OPTIONS

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