Is the New Jersey Wholesale Market Back on Track?

Two weeks ago,without much fanfare,Sentinel Data Centers announced that it had signed three major leases with “the largest”Fortune 500 firms for an initial aggregate footprint of 50,000 SF of turnkey data center space.  Since Sentinel’s first phase in  Somerset,N.J. represents 50,000 sf of data center space,this means that Sentinel has effectively sold out its first phase.  This press release came three weeks after The Wall Street Journal proclaimed that there was a “glut”of New Jersey data center space.

Meanwhile,we’ve heard from Digital Realty Trust ,that the company is now at 100% capacity in . . . →Read More:Is the New Jersey Wholesale Market Back on Track?

Data Center Activity Heats Up In Manhattan

Spotlight New York:

  • Since Google’s acquisition of 111 Eighth Ave.,all available space in the building has been taken off the market. The most recent data center transaction in the building was Digital Realty Trust’s sublease of 53,000 square-feet to Telx shortly before the building’s sale.
  • Sabey and local developer Young Woo are under contract to purchase 375 Pearl St.,a 1-million-square-foot former Verizon switching building,for an estimated $100 per square-foot from M&T Bank. The building is well-suited for data center use,with very heavy floor loads,high ceiling heights,limited windows,and abundant shaft space.  Verizon will maintain a three-floor condo interest in the building.
  • . . . →Read More:Data Center Activity Heats Up In Manhattan

Space Invaders:The Take up of Colocation in NYC &NJ

In the latest issue of Datacenter Dynamics Focus I was quoted regarding the NYC and NJ colocation and wholesale data center market.  For Datacenter Dynamics’take on the market and some of my insights,check out the article here:Space Invaders:The Take up of Colocation in NYC and New Jersey

The Future of Wholesale Data Centers

If you read our market reports,you may have read that some of the largest and most active customers of Wholesale Data Center space are large technology companies like Microsoft,Facebook,Yahoo! and Google.

With that in mind,you may have found today’s Wall Street Journal article regarding Facebook’s Prineville Oregon data center interesting.  The article is entitled:“Facebook Data Center is Boon for Oregon Town.”

Rendering of Facebook's Prineville Data Center

The article describes Facebook’s ambition to build yet a second data center in Prineville,just like the first 300,000 sf facility (the first phase of which is not even open yet!).  You may . . . →Read More:The Future of Wholesale Data Centers

Is there too much supply in Northern New Jersey?

If you have read out latest New York Data Center Newsletter,you may have noticed that quite a bit of new supply has recently come on the market and will continue to come on the market in the next 6-12 months. In light of this,our clients have been asking us,just how much supply is there in NJ,and will demand keep pace?  To help make sense of all of these deals,Grubb &Ellis has been tabulating all of the available space from the major colocation and wholesale data center companies in Northern New Jersey.  Here’s what we’ve found:

Total Available Raised Floor Space:About 387,000 SF . . . →Read More:Is there too much supply in Northern New Jersey?

New York Market Update

National Highlights

  • PowerLoft sold its 233,000-square-foot building in Manassas,Virginia,for approximately $115 million to Corporate Office Properties Trust. The property was 16 percent leased and continues to support the notion that REITS will provide liquidity for data center developers.
  • Given the number of transactions in the market,we should see a strong fourth quarter of leasing activity on a national basis.

Spotlight:New York

  • The entrance of 111 Eighth Ave. onto the investment sales market could create a shift in the Manhattan data center market.  A new owner may choose to maximize returns by converting existing office space into new data center space as . . . →Read More:New York Market Update