Top 5 Data Center Companies & 7 U.S. Markets

Summary

In this video, Adam Simmons from DGTL Infra provides an insightful overview of the five largest publicly traded data center companies in the U.S.: Equinix, Digital Realty, CyrusOne, CoreSite, and QTS Realty Trust. He explains the distinctions between retail and wholesale data centers and explores key metrics of these providers. The video also highlights the top seven U.S. data center markets—Northern Virginia, Silicon Valley, New York/New Jersey, Chicago, Dallas Fort Worth, Phoenix, and Atlanta—discussing their supply, demand, and future growth potential. This comprehensive analysis reveals the critical infrastructure supporting our data-driven world.

Takeaways

• 😀 Data centers are critical for providing power, cooling, security, and connectivity to major companies worldwide.
• 😀 The five largest publicly traded data center companies in the U.S. are Equinix, Digital Realty, CyrusOne, CoreSite, and QTS Realty Trust.
• 😀 Data centers are categorized into retail and wholesale, with retail serving multiple smaller clients and wholesale catering to large-scale deployments.
• 😀 Equinix operates 227 data centers globally, supporting over 10,000 customers with 387,000 interconnections.
• 😀 Digital Realty, the second largest REIT, has a footprint of 284 data centers and supports 4,000 customers with 162,000 interconnections.
• 😀 CyrusOne operates 53 data centers, primarily in the U.S. and Europe, and has 23,000 interconnections.
• 😀 CoreSite and QTS Realty Trust also provide significant data center services, contributing to the industry's overall capacity.
• 😀 Northern Virginia is the largest U.S. data center market, driven by hyperscale demand, with a low vacancy rate of 8%.
• 😀 Silicon Valley has a tight supply due to limited land availability, leading to a vacancy rate of just 5%.
• 😀 Key demand drivers across major markets include large tech companies like Microsoft Azure and Facebook, impacting overall capacity and absorption rates.

Q & A

What are the two main categories of data centers?

Data centers can be broadly categorized into retail data centers and wholesale data centers.

What distinguishes retail data centers from wholesale data centers?

Retail data centers are multi-tenant facilities that serve smaller businesses with lower power requirements, while wholesale data centers provide larger spaces and power for large-scale computing and storage needs, typically serving fewer, larger customers.

Which company is the largest publicly traded data center REIT?

Equinix is the largest publicly traded data center REIT, with a global footprint of 227 data centers.

How many interconnections does Equinix have?

Equinix has 387,000 interconnections, also known as cross connects, facilitating data exchange between customers.

What are the key metrics for Digital Realty?

Digital Realty operates 284 data centers with a power capacity of 1,800 megawatts and supports over 4,000 customers.

Which data center market is the largest in the United States?

Northern Virginia is the largest data center market in the United States in terms of supply, with 1,275 megawatts.

What factors drive demand in the Northern Virginia market?

Demand in Northern Virginia is driven by large hyperscale requirements from companies like Microsoft Azure and Facebook.

Which data center market has the lowest vacancy rate?

Silicon Valley has the lowest vacancy rate among the seven major markets, at only 5%.

What role do financial services firms play in the New York and New Jersey data center market?

Financial services firms are the primary drivers of demand in the New York and New Jersey market, which is also more affordable than New York City.

What is the vacancy rate in the Dallas Fort Worth market?

The Dallas Fort Worth market has an elevated vacancy rate of 21%, with competitive pricing due to numerous competitors.