Texas Data Center Summit Preview: JLL’s Bo Bond Bullish on Market, Says Diversification Pushing Data Centers to Success
by Josh Anderson
DALLAS, TX – Bo Bond is Managing Director and Co-Leader of JLL’s global Data Center Solutions practice team. He is a recognized leader in the real estate industry whose knowledge of technical issues, infrastructure, and labor assessment has allowed him to develop the unique skill set required for mission critical and contact center requirements. Bo works with clients to develop the necessary strategies to meet their individual objectives including tenant and owner representation, investment sales and acquisitions, leasing and development of these unique assets. Bo has over 24 years of experience in the commercial real estate industry. He was with The Staubach Company for ten years, and became a member of the JLL team when they merged with Staubach in July 2008. Bo has successfully negotiated over 20 million square feet of real estate transactions in multiple states.
Bo frequently provides keynote addresses for CapRE’s data center summits, including the upcoming Fifth Annual Texas Data Center Summit in October 2017. In anticipation of this event, we connected with Bo for a Q&A of a sneak preview of his remarks.
CapRE: Thanks for chatting with us today. Please share with our readers what you’ve been up to lately at JLL.
Bond: We’ve been very busy as a group. Specifically for my team, we are really close to closing on a couple of transactions, not only in the Southwest, but in other parts of the U.S. A couple of clients are asking us to do work overseas as well. So our international partners are very engaged on some good projects. The net of it is that we’re blessed with some great business and we’re very bullish on the industry.
CapRe: Interesting. Why are you so bullish?
Bond: If you look at most recent reports that JLL put out, which are now a little old, but if you look at the first half of 2017, there is really good absorption across the U.S. It doesn’t compare to 2016, but 2016 is a year we’re not sure we’ll ever see again. It was so heavily weighted by the cloud.
CapRE: Ain’t that the truth. So that’s true across different markets and sectors?
Bond: Breaking it down by markets and by sector, we found that the cloud is starting to reach into new markets. That’s coming true as the cloud hits, not necessarily the edge, but as it allows for other points across the US to make sure they’re serving user nodes as well as latency. But the most positive thing we saw in the first half of the years’ results was very positive absorption in the financial sector. Also the insurance sector. And the technology sector.
This is all further diversifying our markets. They’re not so heavily weighted as people expected the Cloud to be. That’s really good for investors and the multi-tenant data center market. And that diversity continues to challenge the way we build and operate facilities on behalf of our clients. So we are very excited to continue to see that diversity across multiple industry types in the multi-tenant data center market.
CapRE: So on the flipside, any obstacles or negative trends lines you’re keeping an eye on?
Bond: I’m not sure there are challenges or negatives, per sé. I think that the industry, from a user perspective, is looking for more flexibility as they purchase Cloud, whether that is a private hybrid, public cloud, in terms of how they utilize it. How they acquire colocation space. The services that they might wrap around it. The gateway to the cloud. Their geographic separation. The latency between the facilities and applications.
CapRE: And why is that?
Bond: I would say that there is a continued challenge of complexity of flexibility, because technology is growing at such a rapid rate. The need to protect that data is at the highest level we have ever seen. But I believe that our clients, the users of the space, that are providing services, the financial companies, the insurance companies, the retailers, the tech companies, the manufacturers, they’re doing everything they can. Though they are having to chase this ever-growing technology challenge that continues to run. But it also produces positive things that spin out of it. So with that, it’s no different than the past. We just feel like its’ going faster. And it’s even broader. So just keeping our arms around that growth and that creep is probably one of our clients’ biggest challenges today.
Stay tuned for the second part to this Q&A, where Bo will discuss disruptive technologies, market lumpiness, and how the recent natural disasters in the South impacted the data center industry.