More than 200 executives from 135 firms attend the first annual Southwest Data Center Summit held at the Los Angeles Athletic Club on Wednesday, October 17. While the focus was on the Southwest’s region’s unique challenges, Brian Klebash, president and founder of CapRate Events, LLC, the company that organized the event, said that executives from other national regions attended the summit.
Panel sessions featured speakers from the data center industry who discussed the important trends and issues affecting the region. Topics included the state of the market, debt and equity sources, and data center design.
Key takeaways from the summit included the trend toward a smaller footprint to maximize returns because of the high cost of power in Los Angeles, according to Michael Siteman, executive vice president, Data Center Solutions, Jones Lang LaSalle. Despite the challenges of power and earthquake threat, the demand in the area is strong, Siteman added.
Additionally, the average deal size is getting smaller, said Mitch Kralis, vice president of real estate, Server Farm Realty, while the lead time is getting longer. It takes a long time to enter the Los Angeles market because of state regulations, he added.
John Giaquinta, president of DatacenterAndColocation, said that these particular challenges, along with higher labor costs, will force the state of California to provide incentives to data center companies in an effort to make them stay in the area. “A lot of my Los Angeles clients want out [of the city],” he said.
The second annual Southwest Data Center Summit will be held October 2013 in Los Angeles.
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