SoCal Data Center Leasing Up 23%

Pat Lynch

The data center market is growing rapidly, with several markets reporting an increase in leasing activity. In Southern California, data center leasing activity was up 23% in 2018, according to research from CBRE; however, the significant increase still trailing behind surrounding markets, like Phoenix and Las Vegas, which are leading in data center activity. In 2018, Los Angeles had 10.3 megawatts of absorption, but 10.7 megawatts of new capacity came to market, increasing the vacancy rate by 140 basis points to 15.2%. Still, Southern California’s data center market is healthy.

“Data center activity in Southern California in 2018 was largely attributed to a single hyperscale cloud provider who expanded into the market,” Pat Lynch, senior managing director of data center solutions at CBRE, tells GlobeSt.com. “Aside from the marquee new entrant to the market, the absorption and activity was small in scale, typically less than 200 kWs and a result of local enterprises expanding their existing footprints.”