Corporate Survey Analysis by Eric Stavriotis
Dec/Jan 08
Some of the biggest year-over-year changes in the rankings of site selection factors can be explained by a dramatic increase in current and recent data-center site selection decisions. Although IT-related facilities comprised only 2 percent of properties currently owned by survey respondents, data centers are becoming a major engine of economic growth for their communities, with dozens of mega-deals either recently completed or in the site selection and construction pipeline.
As more and more business is conducted electronically, data security and reliability have become paramount and data centers have become mission-critical facilities. In seeking the best areas for data centers, companies focus on energy cost and power reliability as primary characteristics. This would help explain why the survey rating for energy availability and costs jumped from 82.4 percent in 2006 to 89 percent in 2007.
The survey's finding that labor costs declined in importance from 95 percent in 2006 to 92.3 percent this year might be explained by the fact that these large data centers do not create a lot of jobs. The increased importance of available land from 73.3 percent to 85.4 percent aligns with the large sites needed for today's data centers, which may exceed 500,000 square feet in building space, surrounded by a large land perimeter for security purposes.
Proximity to major markets, which increased in importance from 76.9 percent to 82.8 percent, is a factor for data centers as well. For instance, New Jersey's location near New York City's financial centers, and its central location in the Boston-to-Washington urban corridor, has helped it land more than a dozen mega-center deals.
It would be imprudent to suggest that the increase in data-center site searches is the sole reason for changing priorities; however, there is no question that this product type is making an impact on the site selection industry.
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