Report: Digital Realty Expanding in Chicago Suburbs

Aug. 9, 2016
Digital Realty has acquired a former Motorola headquarters building in Franklin, Park, Illinois, according to local media. The deal positions Digital Realty for growth in the Suburban Chicago market, where cloud players are actively leasing data center space.

Digital Realty is expanding its presence in the suburban Chicago market. The company has acquired a former Motorola headquarters building next to its existing data center campus in West Franklin Park, according to Crain’s Chicago Business, and plans to build additional capacity on the 18.5 acre property.

The deal would provide more room to grow for Digital Realty, which has already filled two large data center buildings at its Digital Chicago development and is building a third.

The company has leased about 27 megawatts of capacity at the campus in Franklin Park, which is just south of O’Hare Airport, about a 30-minute drive West of downtown Chicago. The newest building will provide an additional 12.8 megawatts of commissioned power.

It’s the latest example of how data center providers are buying property to ensure they can continue to support the rapid growth of cloud computing and other emerging technologies. Similar activity is being seen in two other leading Noth American data center markets, in Northern Virginia and Silicon Valley.

The Motorola property includes a 269,000 square foot office building and a 488,000 square foot warehouse, which are both directly across the street from the existing Digital Chicago campus.

Digital Realty has not announced the acquisition, and declined comment for the Crain’s story, in which the seller discussed the transaction.

Local officials in Franklin Park say they have met with Digital Realty about the redevelopment of the Motorola site, but the planning process is in the preliminary stages.

Chicago Poised for Growth

The Chicago data center market appears poised for growth. Leasing was strong during 2015, with net absorption of 27 MW of capacity. This robust leasing has prompted new construction, with up to 200 MW of additional capacity planned for coming years.

Chicago is among the regions positioned to benefit in coming years as new technologies drive massive demand for data center space and network capacity. Chief among these trends is the gradual shift of IT capacity from enterprise data centers to web-scale cloud computing platforms, which is already driving historic demand from cloud builders like Amazon, Microsoft and Google.

Cloud players have had an appetite for space in the Suburban Chicago market, which offers the large footprints that are difficult to find in Downtown Chicago. Microsoft, Rackspace, Facebook, Apple, Oracle and Salesforce have all leased space with wholesale data center providers in and around O’Hare.

That’s why data center providers in the region are building additional capacity. CyrusOne, which recently purchased the former CME data center in Aurora, has announced plans to build a 300,000 square foot data center on 15 acres of open land on that property, which it expects to bring online next spring. DuPont Fabros Technology, which operates two large data centers in Elk Grove Village, has acquired 12 acres of adjacent land which it is preparing for development. DFT plans to build a 305,000 square foot facility, which it expects to complete by fall of 2017.

For more on the Chicago market, we invite you to download the Data Center Frontier Special Report: The Chicago Data Center Market.

About the Author

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.

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