At a glance
- U.S. data center vacancy fell to a record low of 1.4% in the first half, according to a CBRE report cited by Commercial Observer, even as the country added a record amount of new capacity.
- Investors underwriting new data center capacity now have to schedule water, utility power and local approvals alongside land and construction spend.
- CloudHQ closed an oversubscribed $1.4 billion asset-backed securities facility in May, backed by two Virginia data centers.
CloudHQ founder Hossein Fateh named local opposition and government limits on data center water and power as the main brake on the U.S. data center building boom in an interview with Commercial Observer.
U.S. data center vacancy fell to a record low of 1.4% in the first half, according to a CBRE report cited by Commercial Observer, even as the country added a record amount of new capacity.
Investors underwriting new data center capacity now have to schedule water, utility power and local approvals alongside land and construction spend. A project that loses any of those does not reach the leasing market, putting a political variable on the same line as the construction budget.
CloudHQ closed an oversubscribed $1.4 billion asset-backed securities facility in May, backed by two Virginia data centers. The loans secured AAA ratings from Moody's, Kroll Bond Rating Agency and Fitch; Commercial Observer reported it was the first data center ABS loan Fitch had rated AAA.
The company owns more than 30 million square feet of data centers in 12 countries with an IT load above 2,000 megawatts, and has projects under development in the Chicago area, Mexico and Japan. Mexico's operating data center capacity is concentrated in Querétaro, which holds 72%, as Private Wealth Daily previously reported.
These are blue-collar electricians and mechanical steamfitters that are making $150,000 a year.Hossein Fateh, founder and CEO of CloudHQ
Commercial Observer reported that citizens are protesting data centers' water and power use and that governments at all levels have implemented or are considering development limits. Fateh likened industry construction spending to the U.S. railroad boom 175 years ago and argued the buildout supports well-paid trades work. "These are blue-collar electricians and mechanical steamfitters that are making $150,000 a year," he said.
Fateh said the ABS facility will help fund CloudHQ's growth. The $1.4 billion is secured by the two Virginia data centers; the water and power constraints apply to projects still under development in the Chicago area, Mexico and Japan.
Reported by the Sectors desk from Commercial Observer and CBRE report, cited by Commercial Observer. Published . Corrections