{"id":174351,"date":"2023-03-07T15:57:04","date_gmt":"2023-03-07T22:57:04","guid":{"rendered":"https:\/\/inbusinessphx.com\/?p=174351"},"modified":"2023-03-07T15:57:04","modified_gmt":"2023-03-07T22:57:04","slug":"phoenix-ranks-fifth-nationally-for-data-center-leasing-activity-in-2022","status":"publish","type":"post","link":"https:\/\/staging.inbusinessphx.com\/?p=174351","title":{"rendered":"Phoenix Ranks Fifth Nationally for Data Center Leasing Activity in 2022"},"content":{"rendered":"

\"\"<\/a><\/strong><\/p>\n

Activity from out-of-state technology companies drove unprecedented data center leasing activity in Phoenix during 2022, according to a new report<\/a> from CBRE. The market\u2019s absorption \u2013 a measure of net leasing activity \u2013 had 44.3 megawatts (MW) of net absorption in 2022, an increase of 48.7% from 2021.<\/p>\n

\u201cPhoenix continues to be a destination for many firms when selecting a site for their data center inventory,\u201d said CBRE\u2019s Executive Vice President Mark Krison<\/a>. \u201cThis is evident by STACK Data Center\u2019s recent purchase of 80 acres in central Phoenix for their multi-building campus with over 200 MW to be provided.\u201d<\/p>\n

Supply continued to be an inhibitor for growth in the Phoenix data center market with vacancy decreasing from 11.9% to 8.5% year-over-year. Over 77% of the 85.5 MW currently under construction has been preleased, putting additional pressure on developers to bring new data center space to the market.<\/p>\n

Phoenix joins other top locations with power delays or constraints. Both APS and SPR report longer delays for quality redundant power delivery.\u00a0 Similarly, environmental concerns will play a role in data center activity in 2023 throughout the Southwest. Water use and availability in the region are important considerations in site selection.<\/p>\n

National Trends<\/strong><\/p>\n

CBRE\u2019s latest North American Data Center Trends Report\u00a0found that tight market conditions and escalating energy and construction costs caused primary-market average asking rents to increase 14.5% year-over-year to $137.90 per kW, the first year-over-year increase in pricing since 2017.<\/p>\n

The seven primary U.S. data center markets* logged 686.9 megawatts (MW) of net absorption, up nearly 40% year-over-year. Despite a 17% increase in supply, vacancy fell to a record-low 3.2%. Two-thirds of the net absorption occurred in the first half of the year, as power and land constraints in certain markets, as well as construction delays, weighed on activity in H2 2022.<\/p>\n

\u201cData center leasing slowed in the second half of 2022, but this was driven purely by a lack of available space and power constraints,\u201d said Pat Lynch, Executive Managing Director, Global Head of Advisory & Transaction Services, Data Center Solutions, CBRE. \u201cDemand from enterprise users and cloud service providers remains very strong, particularly as companies continue to adopt hybrid work strategies and prioritize private cloud networks.\u201d<\/p>\n

Top Data Center Markets<\/strong><\/p>\n

Northern Virginia remained the most active data center market with net absorption of 436.9 MW, with the market\u2019s vacancy rate falling to under 1%, despite significant power constraints.<\/p>\n

Top 10 Most Active Markets<\/strong><\/p>\n\n\n\n\n\n\n\n\n
Market<\/strong><\/td>\n2022 Net Absorption<\/strong><\/td>\nMarket<\/strong><\/td>\n2022 Net Absorption<\/strong><\/td>\n<\/tr>\n
Northern Virginia<\/td>\n436.9 MW<\/td>\nPhoenix<\/strong><\/td>\n44.3 MW<\/strong><\/td>\n<\/tr>\n
Hillsboro<\/td>\n64.4 MW<\/td>\nToronto<\/td>\n43.1 MW<\/td>\n<\/tr>\n
Silicon Valley<\/td>\n62.4 MW<\/td>\nCentral Washington<\/td>\n35.0 MW<\/td>\n<\/tr>\n
Chicago<\/td>\n48.0 MW<\/td>\nAtlanta<\/td>\n33.0 MW<\/td>\n<\/tr>\n
Dallas\/Ft. Worth<\/td>\n44.3 MW<\/td>\nMontreal<\/td>\n26.5 MW<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Northern Virginia (371.5 MW) accounted for 65% of new primary-market supply delivered in 2022. Other markets with notable supply growth included Silicon Valley (66.0 MW), Hillsboro, Ore. (59.0 MW), Toronto (44.0 MW) and Phoenix (37.5 MW).<\/p>\n

To view the full report,\u00a0click here<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Activity from out-of-state technology companies drove unprecedented data center leasing activity in Phoenix during 2022, according to a new report from CBRE. The market\u2019s absorption \u2013 a measure of net leasing activity \u2013 had 44.3 megawatts (MW) of net absorption in 2022, an increase of 48.7% from 2021. \u201cPhoenix continues to be a destination for […]<\/p>\n","protected":false},"author":2,"featured_media":11303,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_eb_attr":"","footnotes":""},"categories":[6],"tags":[5],"class_list":["post-174351","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy-trends","tag-hot-topics"],"_links":{"self":[{"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=\/wp\/v2\/posts\/174351","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=174351"}],"version-history":[{"count":0,"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=\/wp\/v2\/posts\/174351\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=\/"}],"wp:attachment":[{"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=174351"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=174351"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.inbusinessphx.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=174351"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}