Phoenix Market Data Center Expectations

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Last year was another hot year for data center activity in the Phoenix market. Below is a summary of the top three happenings and the top three expectations for 2017.

2016 Happenings

  1. CyrusOne continued to expand space on its campus in Chandler, with construction under way on a fully preleased fourth building, consisting of approximately 102,000 square feet and 9 MW.
  2. Phoenix recognized an increased absorption by cloud and software-as-a-service (SaaS) companies.
  3. Aligned Data Centers delivered its first 21,000-square-foot facility, with 3 MW of expandable space, and is under construction of an additional 21,000 square feet. The company’s leasing structure is expected to drive tenant demand.

2017 Expectations

  1. Due to the current low vacancy rate, new multitenant data center providers will continue to actively seek new entry into the Phoenix market to meet the consistent demand.
  2. Major cloud providers are expected to take up large chunks of space in Phoenix.
  3. More than 70 MW are still in demand, so expect approximately 35 MW of absorption to be taken up by cloud providers, existing tenant expansions and added transition by enterprises out of self-operated data centers.

Click here to read more about Phoenix and U.S. data center sector trends in JLL’s 2017 Data Center Perspective.

About the author

Mark BauerMark Bauer, JLL Data Center Expert is a Managing Director and Co-Leader of JLL’s global Data Center Solutions group. With unmatched experience and knowledge in the growing multi-tenant data center environments (colocation and wholesale colocation), Mark provides clients with strategic and tactical guidance and representation to meet investment, acquisition, leasing and development objectives.

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