Vancouver Might Give an Investor Pause, But There’s a Lot of Pent Up Demand

VANCOUVER, BRITISH COLUMBIA – CapRE’s inaugural Vancouver Data Center Summit kicked off with a round-table titled Greater Vancouver Data Center Market 360: A Big Picture Overview, and Making Sense of Recent M&A Activity, the Ins-and-Outs of Deals, and What it Means for the Industry. Below, we cover a brief Q&A between moderator Brian Klebash, CEO and Founder of CapRE and two of his panelists — Todd Coleman, President and CEO, Estruxture Data Centers &  Rino Civitarese, Senior Sales Executive, CenturyLink – about some of the intricacies of the Vancouver data center arena.

New SquareKlebash: Todd, why are you in the Vancouver market?

Coleman: For us, we have raised 180 Million USD in the last eighteen months. We have a great set of investors, including the second-largest pension fund in Canada. So we’re prepared to go to the market in a significant way. When I talk about 15,000 square feet being the largest carrier-neutral data center, and it happens to sit in a downtown with extraordinary economics, it’s not hard to change the dynamics of this data center market.

I don’t happen to think that it’s worthy of 500,00 square feet. I don’t even think it’s worthy of 100,000 square feet. But 50,000 square feet changes the market dynamics, because you’ve probably added 50 if not nearly 100% of the current data center space, and certainly more than doubled the total white space that is available in the market. So that’s sort of the market dynamic. But for us, it’s [about] the ability to come in, lead in the market, take massive market share and be one of the leading providers.

Klebash: Rino, if someone has hesitation about coming into Vancouver, how would you dispel any concerns or hesitation about entering that market? Todd raised several concerns about power, fault lines, what would you tell the investor or developer?

Rino Civitarese, Senior Sales Executive, CenturyLink

Rino Civitarese, Senior Sales Executive, CenturyLink: That’s a very good question. I think that…there is a combination of factors when you look at the Vancouver market. There are geographic factors, economic factors and growth trends. Even if you start to look at what the movie industry is doing here and combine that with the growth rate of the Internet of Things, and all of the technology that drives that….my background has to do with applications plus the supply chain.

So you have to begin to wonder how the small organizations, as well as the medium to large organizations, really need to look at the impact of the decisions that they’re about to make to grow their business and what that’s going to look like three to five years from now. So a huge amount of planning needs to go into any investment you’re going to make in terms of infrastructure.

What we do know though is that, in the Vancouver market, and yes, there’s always going to be a lot of risk in terms of where you locate, but we see a lot of pent up demand here. There are a lot of industries in the local and regional area looking for more capacity. And we see that. between the work that we’re doing with CenturyLink and VariNet, I think there’s a lot of opportunity for us all in the next three to five years.

For more from this panel, check out previous CapRE Insider Reports: