• About Us
  • Partnership Opportunities
  • Privacy Policy

Data Center Frontier

Charting the future of data centers and cloud computing.

  • Cloud
    • Hyperscale
  • Colo
    • Site Selection
    • Interconnection
  • Energy
    • Sustainability
  • Cooling
  • Technology
    • Internet of Things
    • AI & Machine Learning
    • Edge Computing
    • Virtual Reality
    • Autonomous Cars
    • 5G Wireless
    • Satellites
  • Design
    • Servers
    • Storage
    • Network
  • Voices
  • Podcast
  • White Papers
  • Resources
    • COVID-19
    • Events
    • Newsletter
    • Companies
    • Data Center 101
  • Jobs
You are here: Home / Colo / Broad Demand Drives Data Center Boom in Dallas-Fort Worth

Broad Demand Drives Data Center Boom in Dallas-Fort Worth

By Rich Miller - July 17, 2018

Broad Demand Drives Data Center Boom in Dallas-Fort Worth

The exterior of the RagingWire TX1 data center in Garland, the first of a planned five buildings. (Photo: RagingWire)

LinkedinTwitterFacebookSubscribe
Mail

We continue our series of stories on the leading geographic markets for data center space. Data Center Frontier is partnering with DatacenterHawk to provide in-depth market reports on each city we profile. This time, we revisit the Dallas data center market, which is notable for its diverse data center ecosystem. This is the first post in a four-part series, and provides a Dallas data center market overview and analysis. 

data center ecosystem

Download the full report.

The Dallas Fort Worth region data center market is one of the largest and most active data center markets in the United States. It is currently experiencing a data center building boom, with hundreds of megawatts of potential capacity in the pipeline. The Dallas market is benefiting from excellent power and fiber infrastructure, competitive economic incentives and robust competition among service providers.

Dallas is notable for the diversity of its data center ecosystem, with strong demand for retail colocation, wholesale data center space, powered shell and build-to-suit projects. The market is boosted by its location in the center of the country, and sees demand for space from multiple business verticals, including hosting and cloud players as well as enterprise customers in finance and energy. Dallas also benefits from the fact that the state of Texas operates its own power grid, isolating it from power outages from other regional interconnection markets.

The Dallas area is home to 2.99 million square feet (SF) of commissioned data center space, representing 334 megawatts (MW) of commissioned power, according to market research from datacenterHawk. That makes Dallas the third-largest market for data center capacity in the U.S., trailing only Northern Virginia and Silicon Valley, and just ahead of Chicago. In square footage, Dallas is the second-largest market, slightly ahead of Silicon Valley. Demand for space is fairly strong, as reflected in the vacancy rate of 15.0 percent in the region.

Dallas is currently the focus of a data center building boom, with most of the industry’s major wholesale data center providers adding capacity and creating multi-building campuses for future growth. There was 50 MW of available power capacity at the close of 1Q of 2018, with an additional 11 MW under construction. In addition, there is a whopping 570 MW of additional capacity in the planning stages, indicating a strong expectation of growth.

data center ecosystem
A key question is whether Dallas will emerge as a leading market for hyperscale data centers, the huge facilities that house the IT operations of the largest cloud platforms, social networks and Internet companies. Demand in Dallas-Fort Worth has historically been driven by enterprise customers and service providers, rather than the huge leases by cloud providers that have boosted activity in other major markets, particularly Northern Virginia.

Will Dallas Win Hyperscale Deals?

Will Dallas begin winning hyperscale projects? This is a matter of debate among industry veterans with experience in the Dallas market, with some anticipating that larger hyperscale requirements are coming, while others believe that these expectations are premature. The answer to the “hyperscale question” will be a key factor in the data center absorption rate in Dallas, and the pace of growth going forward.

The region’s data center capacity is spread across several sub-markets, including major carrier hotels in downtown Dallas, a nexus of wholesale data centers in the “Telecom Corridor” in Richardson and northern suburbs. The current hot spot for new development is Garland, where city-owned power and the availability of land is creating a growing cluster of wholesale data center providers. To the West, there is a growing cluster in Fort Worth featuring a Facebook data center campus and a huge new project led by T5 Data Centers.

Here's what the data centers will look like at T5@Alliance, the new project from T5 Data Center and IPI. (Image: T5 Data Centers)

Here’s what the data centers will look like at T5@Alliance, the new project from T5 Data Center and IPI. (Image: T5 Data Centers)

Over the past two years, the Dallas market has emerged as a focus of significant investment by leading players in the data center industry. This includes new ownership and strategic focus impacting major carrier hotels in downtown Dallas, the entry of new players in Dallas suburbs, and significant expansions by existing providers.

Over the last three years, Dallas/Fort Worth has drawn large corporate relocations. Most companies go to Texas due to the state’s central location, affordable real estate prices, and good tax incentives. The Dallas area in particular has a diversified labor force, with strong growth recently from the technology and services industries.

In the first quarter of 2018, the DFW market saw job growth of 3.7%, slightly ahead of the pace of job growth across the rest of the state (3.5%) and the United States overall (2.3%), according to data from the Federal Reserve Bank of Dallas. In addition, the Dallas market’s unemployment rate is currently 3.6% and has been steadily declining since 2009.

Background & History

The early growth of DFW’s data center market was focused in downtown Dallas. Because the central business district is rich in telecommunication infrastructure, several large office buildings were retrofit for data center use, most prominently the Infomart Dallas, 2323 Bryan Street and the former Federal Reserve Building. These buildings typically attract smaller colocation customers, along with telecommunications companies.

As the colocation market grew significantly in 2009 and 2010, these companies expanded beyond downtown. An obvious expansion route was the northern suburbs of Dallas, which boomed during the 1990s when the “Telecom Corridor” attracted dozens of leading companies in the telecom, software and semiconductor sectors. This area was hit hard during the dot-bust of 2001 to 2003, but has seen a new round of growth as Dallas has emerged as a hotbed for hosting and colocation.

Cities like Richardson, Plano, Carrollton, Allen and Garland benefited from the growth by offering sites and buildings with expansion opportunities. In addition, most colocation providers in the DFW market are choosing to construct new facilities instead of retrofitting existing buildings worthy of conversion.

Over the next few weeks, the Data Center Frontier series on the Dallas Data Center Market will cover the following topics for the region:

  • Trends in Supply
  • Trends in Demand
  • Business Environment

Download the full Data Center Frontier “Dallas Data Center Market” special report, courtesy of RagingWire Data Centers. 

And for further coverage, check out Data Center Frontier’s page dedicated to the Dallas Data Center Market, that will provide the latest stats and info on this quickly growing area that is continuing to experience a data center boom.

LinkedinTwitterFacebookSubscribe
Mail

Tagged With: Dallas Data Center Market, Data Center Site Selection, RagingWire Data Centers, special report

Newsletters

Stay informed: Get our weekly updates!

Are you a new reader? Follow Data Center Frontier on Twitter or Facebook.

About Rich Miller

I write about the places where the Internet lives, telling the story of data centers and the people who build them. I founded Data Center Knowledge, the data center industry's leading news site. Now I'm exploring the future of cloud computing at Data Center Frontier.

  • Facebook
  • Instagram
  • LinkedIn
  • Pinterest
  • Twitter

Voices of the Industry

Building an Enduring World Begins with Accountability and Defining an Approach for Long-term Success

Building an Enduring World Begins with Accountability and Defining an Approach for Long-term Success TJ Faze, Head of ESG Strategy and Engagement at Vertiv, outlines the company's learnings around its recent ESG efforts.

White Papers

fire protection

Fire Protection for Micro Data Centers

Space in micro data centers is limited and must be carefully managed. Compute and storage are typically the priority, so cooling, uninterruptible power supplies, batteries, security, and fire protection must all compete for whatever space is left. A new white paper from Viking Integrated Safety outlines the company’s 1U stand-alone fire protection solution.

Get this PDF emailed to you.

We always respect your privacy and we never sell or rent our list to third parties. By downloading this White Paper you are agreeing to our terms of service. You can opt out at any time.

DCF Spotlight

Data center modules on display at the recent Edge Congress conference in Austin, Texas. (Photo: Rich Miller)

Edge Computing is Poised to Remake the Data Center Landscape

Data center leaders are investing in edge computing and edge solutions and actively looking at new ways to deploy edge capacity to support evolving business and user requirements.

An aerial view of major facilities in Data Center Alley in Ashburn, Virginia. (Image: Loudoun County)

Northern Virginia Data Center Market: The Focal Point for Cloud Growth

The Northern Virginia data center market is seeing a surge in supply and an even bigger surge in demand. Data Center Frontier explores trends, stats and future expectations for the No. 1 data center market in the country.

See More Spotlight Features

Newsletters

Get the Latest News from Data Center Frontier

Job Listings

RSS Job Openings | Pkaza Critical Facilities Recruiting

  • MEP Coordinator - Data Center Construction - Ashburn, VA
  • Data Center Facility Engineer - Chantilly, VA
  • Data Center Site Operations VP - Seattle, WA
  • Senior Electrical Engineer - Data Center - Denver, CO
  • Senior Estimator - Data Center Construction - Denver, CO

See More Jobs

Data Center 101

Data Center 101: Mastering the Basics of the Data Center Industry

Data Center 101: Mastering the Basics of the Data Center Industry

Data Center Frontier, in partnership with Open Spectrum, brings our readers a series that provides an introductory guidebook to the ins and outs of the data center and colocation industry. Think power systems, cooling, solutions, data center contracts and more. The Data Center 101 Special Report series is directed to those new to the industry, or those of our readers who need to brush up on the basics.

  • Data Center Power
  • Data Center Cooling
  • Strategies for Data Center Location
  • Data Center Pricing Negotiating
  • Cloud Computing

See More Data center 101 Topics

About Us

Charting the future of data centers and cloud computing. We write about what’s next for the Internet, and the innovations that will take us there. We tell the story of the digital economy through the data center facilities that power cloud computing and the people who build them. Read more ...
  • Facebook
  • LinkedIn
  • Pinterest
  • Twitter

About Our Founder

Data Center Frontier is edited by Rich Miller, the data center industry’s most experienced journalist. For more than 20 years, Rich has profiled the key role played by data centers in the Internet revolution. Meet the DCF team.

TOPICS

  • 5G Wireless
  • Cloud
  • Colo
  • Connected Cars
  • Cooling
  • Cornerstone
  • Coronavirus
  • Design
  • Edge Computing
  • Energy
  • Executive Roundtable
  • Featured
  • Finance
  • Hyperscale
  • Interconnection
  • Internet of Things
  • Machine Learning
  • Network
  • Podcast
  • Servers
  • Site Selection
  • Social Business
  • Special Reports
  • Storage
  • Sustainability
  • Videos
  • Virtual Reality
  • Voices of the Industry
  • Webinar
  • White Paper

Copyright Endeavor Business Media© 2022