The data centre field has grown significantly in the last few years because of the astronomical rise in demand for cloud computing and artificial intelligence. Property developers have also joined the trend and investigated the potential in this field. But when it comes to the data centre market, they need to be mindful of a couple of key factors that can make or break them in the sector.
What is a data centre market?
Before we get to the nitty-gritty, let’s first discuss the data centre market and its roles. It’s a crucial segment of the technology industry that supplies and manages the physical groundwork needed for hosting operating IT systems and network equipment. Given how many things have gone digital in the past few years, data centres continue to rise, thus making the field competitive and the market demand high.
What are the unique requirements of data centres?
Because of the unique nature of work, data centres have specific requirements that set them apart from traditional commercial real estate, such as the following:
Significant power density. Because data centres’ are rooted online, they need a significant amount of power to ensure that their systems and servers are up and running round-the-clock. On that note, developers are required to find a site that can accommodate high power loads and has easy access to good power sources.
Secure system. Since data centres hold a significant amount of data, with some more sensitive than others, the structure must have secure systems and physical infrastructure. Some of these security measures include surveillance systems, strict access control, reinforced walls, and security systems, to name a few. Among other things, the structure must also comply with various regulations depending on your area and region, be it building codes, data privacy laws, or fire safety standards.
Cooling infrastructure. In relation to significant power loads, it’s also crucial that they’re equipped with an effective cooling system to avoid overheating that could lead to system failure. Property developers are required to work with professionals to create a design that implements an efficient cooling system.
Network connectivity. Having a fast and reliable network is also a must since the internet is the backbone of data centres so property developers are also tasked with finding network providers that deliver quality service, ensuring data connections are smooth and uninterrupted.
Factors to consider when assessing market demand and competition.
Because there are a lot of opportunities in the data centre market, it’s important to learn more about the demand and market itself, especially with how competitive the digital landscape has been in the past few years. Here are a few factors that shape the market:
Customer needs. Clients and tenants have specific needs, so conduct due research on them; usually, they require enterprises and hyperscale cloud providers, among many things.
Market demand. It’s important to identify the demands for data centre properties like its AI growth potential and cloud computing.
Competitive landscape. To have an idea of what the latest trends are, you can check the existing data centre properties and assess their services, pricing, or specialties, if any.
All in all, being considerate of all the aforementioned factors and having a thorough understanding of them can help property developers enter the data centre market and capitalize on this venture.
