Sep 03, 2021

Cloud services and social media drive data centre demand

datacentres
CloudServices
SocialMedia
AWS
2 min
Cloud service providers and social media companies such as Facebook are driving data centre demand, a new report by CBRE has found

The North American Data Center Trends Report published by CBRE has found that cloud service providers such as Google Cloud and AWS, as well as social media companies like Facebook and Twitter, are currently driving the demand for data centres. It also discovered that North America’s data centre market was making substantial gains in both construction and net absorption during the first half of 2021. 

The report shows that cloud service providers brought around 214.3 megawatts of new wholesale colocation supply online in seven of the US data centre market’s primary locations in the early stages of the year. This represents a 7% increase from the year before. 

Increasing interest in data centres likely to continue in primary and secondary markets 

Pat Lynch, CBRE Executive Managing Director, Global Head of Advisory & Transaction Services, Data Center Solutions, said: “We've seen no indication that the amount of data created and utilised is leveling out, so demand for data centres likely will continue increasing across both primary and secondary markets.

“Users are beginning to position themselves closer to end-users to support technologies including 5G, artificial intelligence, and edge-computing technology. We continue to see a heavier appetite for data centres from investors who are starting to view data centres in the same category as more traditional real estate sectors,” Pat added. 

The top North American data centre markets

As shown in the report, Northern Virginia remains the most active data centre market, with a total absorption of 70.6MW recorded in H1 of 2021. Phoenix followed behind, although its absorption rating was three times less than that of Northern Virginia. 

Across the seven primary markets, the net absorption reached 142.7MW in the first half of the year, increasing by 3.4% from 2020’s records. Atlanta took third place in the report’s most active markets table, with Hillsboro, OR in fourth, and Chicago rounding off the top five with a net absorption rating of 13.4MW for H1 2021.

 

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