Big Growth Ahead for Data Centers

Property Managers with the Right Background Can Make a Natural Transition.

By Robert Fuller, CPM, CCIM

The number of data centers developed, bought, and sold has exploded worldwide. Indeed, data centers have stepped into the spotlight as a prominent asset type.

Because of the similarities across asset types, a property manager experienced in other property types can successfully transition to managing data centers. No credentialing or degree requirements are needed, but a financial and mechanical background is extremely helpful.

What Are the Responsibilities?

Property management responsibilities include financial budgeting and asset management, electrical and HVAC maintenance, utilities and energy usage, environmental and regulatory requirements, life safety and security, and cleaning and janitorial operations. These areas demand close attention because neglect will result in an inefficient and costly operation.

Despite data centers’ similarities to other asset types, managing the centers is unique because it’s especially crucial to monitor and report utility usage and the amount of energy consumed on a timely basis. The centers have to comply with demanding environmental and regulatory requirements.

Data Centers Gobble Energy

Devices using the internet have been adopted at a tremendous rate, exponentially increasing worldwide energy use. Research reports have cited that data centers in the U.S. alone use more than 90 billion kilowatt-hours of electricity a year, requiring roughly 34 giant—500 megawatt—coal-powered plants to produce that electricity. Globally, data centers in 2020 used roughly 416 terawatts, equal to about 3% of the total electricity consumed worldwide last year.

Industry experts expect this energy consumption to double every four years, making it much more important for data centers to effectively use renewable energy sources such as wind energy and solar power.

Advances in renewables haven’t caused coal to disappear as an energy source. A data center property manager is positioned to reduce energy use and drive up efficiency, thereby reducing energy costs and the center’s carbon footprint.

Future of Data Centers

Virtually all companies use some form of technology, which means data centers are becoming an operational backbone of every industry. In addition, the workforce supporting and maintaining data centers is huge, including IT infrastructure professionals, software developers, IT security engineers, and server and cabling technicians. A traditional workforce also supports the centers: accountants, marketing professionals, brokers and leasing agents, engineers, and, of course, on-site facility managers. This bodes well for the future of data centers and the next generation of real estate professionals.

Editor’s note: This article was adapted from “No Longer Just a Niche,” published in the September/October 2021 issue of the Journal of Property Management.

Advertisement

About Commercial Connections

Commercial Connections is published four times annually and distributed to members of the National Association of REALTORS® and commercial real estate industry leaders. To subscribe to the newsletter, update your M1 profile to include commercial interests in the "Field of Business" list.

Update your Field of Business in M1