North American Data Centers (NADC) has announced the release of its much anticipated annual report on data center real estate activity in 2016. Now in its sixth year, the Data Center Real Estate Review highlights key deals, investment activity and issues impacting both the enterprise and data center colocation markets in North America.
Authored by NADC Managing Principal Jim Kerrigan, the 2016 edition of the Data Center Real Estate Review provides a comprehensive inventory of the most important data center investments and leasing activity throughout the last year. Additionally, the report gives deep analysis on the overarching issues that impacted the data center market in 2016 as well as an outlook on what to expect for data center investment and lease activity in North America in 2017.
Some key takeaways from the report include:
- New data center projects in Quebec and Toronto will create new Multi-Tenant Data Center (MTDC) assets in Canada and while the decrease in the Canadian dollar has brought down construction pricing, rental rates remain significantly higher than US markets.
- Hyperscale cloud leasing led by Microsoft and Oracle in MTDC data centers drove a 25% increase in leasing activity from 2015; a historical high.
- After a strong 2016, REIT stocks focused on data centers will see a short-term setback related to rising interest rates but should otherwise rally during 2017 due to overall demand.
- After a record 2015 for Mergers and Acquisitions (M&A) in the MTDC market, activity slowed in 2016, but transaction value remained high.
“Unique within the data center marketplace, the Data Center Real Estate Review has become one of the hallmarks for executives and analysts tracking key leasing and investment activity in North America each year,” said Jim Kerrigan, managing principal, North American Data Centers. “Because of our extensive history in this field, NADC is able to report on some of the most important information that no other firm has access to. Navigating the differences between the Real Estate and IT markets is increasingly difficult, and we’re delighted to provide a valued resource for those looking for insights into this aspect of the data center industry along with those who want to get a handle for what lies ahead in the coming year.”