Skybox Plans 300-Megawatt Campus South of Dallas

Nov. 20, 2023
Developer Skybox Datacenters is teaming with Bandera Ventures and Principal Asset Management on a large new campus in Lancaster, Texas.

Skybox Datacenters is joining the data center building boom south of Dallas. Skybox will partner with developer Bandera Ventures and Principal Asset Management on PowerCampus Dallas, a 300-megawatt project in Lancaster, Texas, the companies said today.

The Dallas project will be the ninth campus for Skybox and continues its development activity in the Texas market. Skybox built its first project in Houston, and has two projects underway in Austin, including a massive 600-megawatt project in Hutto.

“PowerCampus Dallas will raise the bar in the North Texas data center market and beyond,” said Rob Morris, CEO of Skybox Datacenters. “This partnership brings together expertise in multiple disciplines that are critical for delivering significant capacity in this dynamic data center market.”

Bandera Ventures is an experienced player in the commercial real estate market, with more than 100 million square feet of developed space. For the Dallas project, the capital partner for Skybox will be Principal Asset Management, the investment arm of Principal Financial Group, which manages more than $500 billion in assets.

Principal is an experienced player in the data center sector, said Ben Wobschall, managing director, real estate, Principal Asset Management.

“With over $3 billion committed to the data center sector over the past 17 years, we’ve been able to witness the evolution of the sector first-hand and are excited to utilize strategic partnerships like this one to drive continued success for our clients and customers,” said Wobschall.

Skybox also continues to partner with logistics giant Prologis on data center campuses in Chicago, Austin and other markets.

 

Strong Year for the Greater Dallas Market

The Dallas market is one of the nation’s primary peering and interconnection hubs, featuring excellent proximity to cloud providers and exchanges. In recent years the region has also become a major destination for hyperscale operators, including major campuses for Meta and Google.

The Dallas market saw 110 megawatts (MWs) of data center capacity absorbed in the first half of 2023, according to CBRE, pushing the vacancy rate down to just 4 percent. There was 273 MWS of capacity under construction in the first half of 2023, but also 246 MWs of pre-leasing, meaning most new data center capacity is under contract during the construction phase.

Dallas is not unusual, as inventory is tight in many leading data center markets, due to strong demand for space for AI servers. Meanwhile, the industry has seen longer delivery timelines due to delays in power availability and the supply chain.

“In most major markets, we're seeing single-digit vacancies,” said Morris. “Even prior to the machine learning demand really hitting the market, we were seeing a pretty meaningful imbalance between supply and demand.

“Like everyone else in the industry, we’re doing what we can to enable these projects,” said Morris. “Projects like PowerCampus have been extremely attractive to the growing needs of our customers.”

 

Construction Shifts to South Dallas 

PowerCampus Dallas is the latest project in the southern suburbs of Dallas, which marks a shift in the development focus in the Dallas/Ft. Worth market.

The historic center of data gravity has been north of Dallas, home to dozens of major data centers across Richardson, Plano, Garland and Allen. In recent years development has accelerated south of Dallas, including new campuses for Compass Datacenters, Google, Aligned Data Centers, and Stream Data Centers.

Morris said the PowerCampus Dallas site in Lancaster, which is about 18 miles south of Downtown Dallas, represents “a pretty unique opportunity.”

“With all of the data center activity in South Dallas, we see great reasons to be here as well, and will enter in a meaningful way with the 300 megawatts that we'll have available on this campus,” said Morris.

The campus spans 110 acres and will feature a private 300 MW substation that will be served by Oncor.

Morris noted that the ERCOT power grid offers Texas customers options for working with numerous power providers, as well as demand response programs. Texas offers a state sales tax exemption on electricity or equipment for qualified data centers. 

 

Focus on Wholesale for Enterprise, Hyperscale

Skybox Datacenters is based in Dallas and focuses on purpose-built facilities for the wholesale data center market, working with enterprise, hyperscale and colocation customers.

Skybox was founded in 2014, targeting an opportunity in the growth of “Big Data” in the energy industry, with a focus on 3D seismic imaging in high-power-density environments.

In 2021, Skybox launched a partnership with logistics real estate specialist Prologis Inc. to develop data centers in major U.S. markets. The first project is a 30-megawatt project in Elk Grove Village, the leading data center hub in the Suburban Chicago market.

Logistics specialists like Prologis have extensive real estate holdings in proximity to population centers, which are also key data center destinations as cloud platforms and video services seek to bring content closer to eyeballs.

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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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