Does Chicago Colocation Have Market Oversupply Problems? (SlideShare)

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Does Chicago Colocation Have Market Oversupply Problems?

Chicago is a city of many names…..

Sponsored by http://www.DataCenterLeadGen.com

• The Windy City• Chitown• “My Kinda Town”• The City of the Big Shoulders• Paris on the Prairie

http://www.datacenterleadgen.com/

One nickname you won’t likely find lurking around the internet is “The City of Too

Many Data Centers”. Chicago colocation services are growing rapidly, and service providers like CenturyLink, Equinix, Level 3 and Colocation America are thriving.



Why Chicago for Colo?

Fact is – there are many Chicago colocation service providers that made

a strategic decision to build their facility in the Chicagoland area, for

reasons which include:



•Climate is ideal for cooling with temperature and available water•Abundance of network service providers, prime telecommunication and power service providers•Dense concentration of financial services providers, Content Delivery Networks, and IT integrators•Strategic location for disaster recovery and business continuity• Ideal for transportation in and out of areas with the O’Hare Airport airline hub



Chicago’s retail and wholesale colocation growth rate trails cities like New York,

Dallas, Washington DC and Silicon Valley, but it exceeds the national average for

metropolitan areas.



High Demand and Low Vacancy

Even colo service providers like Digital Realty Trust, which are slowing down their expansion

in other cities across the U.S., continue to expand in “the Big Onion.”



Colocation demand has exceeded supply in Chicago by as much as 50 percent in recent years, which continues to drive

aggressive growth. The vacancy rate for area data centers is only three percent,

which leads all U.S. cities.



Even though Chicago is one of the top markets for colocation, it doesn’t need

any tax incentives for data center builds or expansions for the most part. Growth is fueled exclusively to meet

the constant demand, and much historic and/or prime Chicago real

estate has been converted and retrofitted from industrial or retail to

manage servers and data. Sponsored by http://www.DataCenterLeadGen.com


How Do Taxes Influence Chicago Data Center Trends?The City of Chicago’s Chief Information

Officer Brett Goldstein has a background from both the public sector (Chicago

Police) and private sector, and he feels government CIOs should be as driven to

create efficiency and data security as their private sector peers.



With the financial and unemployment challenges which Chicago has been struggling with in recent years, the success of the colocation and data

management industry is welcomed as a thriving economic engine.



Chicago recently instituted a “Cloud tax”, which some critics feel might drive

data center providers to other cities. Changes are being proposed to the tax already, including breaks for startups

and small businesses.



The influence of Chicago colocation and data services boom will be vital to the local

economy. Technology executives and investors looking for colocation expansion

will find that Chicago is their “kinda town”.



Have you been considering a Chicago colocation center build or expansion?

Does the Cloud tax or lack of tax incentives in the area factor into your

decision making?



Tell us about it in the comments section below.



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Does Chicago Colocation Have Market Oversupply Problems? (SlideShare)

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