Twin Cities Data Center Projects Pick Up Steam

A CenturyLink unit is planning a new Shakopee project; some industry experts consider the Twin Cities to be “underserved” by modern data centers.

The southwest corner of the Twin Cities continues to draw new data center projects.

Technology infrastructure provider Savvis, an arm of telecommunications giant CenturyLink, Inc., announced plans this week to open a new 100,000-square-foot data center in Shakopee in the spring of 2014—marking the latest in a series of such projects in the area.

Dallas-based Stream Data Centers is currently building a 75,675-square-foot data center in Chaska. In another deal, Greenwood Village, Colorado-based ViaWest acquired the vacant former headquarters of Entegris, Inc., in Chaska with plans to convert the 158,000-square-foot office building into a new data center.

“On the business side, the Minneapolis-St. Paul region is a good fit for Savvis, as it’s home to 19 Fortune 500 companies and seven of the largest private companies in the U.S.,” David Meredith, senior vice president and general manager at Savvis, wrote in an e-mail to Twin Cities Business. Meredith said that CenturyLink and Savvis have 2,200 local employees; Savvis has an existing data center in Minneapolis.

The new Shakopee project will be developed by Dallas-based Compass Datacenters, which will lease the space to Savvis. City of Shakopee documents have previously described the new data center as a $67 million project.

“One of the main reasons that Savvis chose this specific location in Shakopee is because it sits on 11 acres of partially developed land,” Meredith said. “As a greenfield site, we will be able to build new phases and expand the data center as demand dictates.”

And data center projects are gaining steam in the Twin Cities.

“There’s been an increase of activity in the southwest, there’s no doubt about it,” said Dan Peterson, a senior associate with the local office of Seattle-based Colliers International, a commercial real estate services company. “I think the folks down there have been making a concentrated effort to attract this type of development for some time . . . and its’ starting to pay off.”

A second-quarter report on the local data center market from Colliers International noted: “Ascent, a St. Louis-based data center developer, has secured a property in the southeast metro to deliver a data center for an undisclosed client.”

Peterson said that industry experts consider the Twin Cities to be “underserved” by modern data centers.

“We know that there are other players that are swirling around,” said Peterson, who is part of Colliers’ technology solutions group. “Right now, there’s a lot of national interest for Minneapolis/St. Paul.”

Monroe, Louisiana-based CenturyLink merged with Qwest Communications in 2011 to create the third-largest telecommunications company in the United States. CenturyLink also acquired Savvis in 2011 for approximately $2.5 billion. For 2012, CenturyLink reported net income of $777 million on $18.4 billion in revenue.

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