Posted By Rich Miller On August 15, 2008 @ 7:55 am In Companies | No Comments
UPDATE: The reports cited in this story were not accurate. See our additional coverage  for more information.
AOL is planning to sell two of its data centers in northern Virginia and reduce its operations staff, according to reports in Valleywag  and Silicon Alley Insider . The reports suggest AOL will sell its Manassas Tech Center and Dulles Tech Center, which between them comprise more than 400,000 square feet of finished data center space. The company will reportedly downsize its staff and outsource some operations duties to Emcor Group .
Why sell the data centers? Northern Virginia  has been a hot data center market, where the industry’s major players have been in expansion mode. Digital Realty Trust  (DLR), Equinix  (EQIX), DuPont Fabros  (DFT), CRG West  and Power Loft  all have active data center development projects in northern Virginia. But that also means there’s already a lot of brand-new space seeking tenants.
One option for AOL is a sale-leaseback, in which a property owner sells a building to a second party, while agreeing to continue to lease space in the building. The transaction generates cash for the former owner (now the tenant), and provides the new owner steady rent from the lease and a tenant with a strong credit rating. Digital Realty Trust has a track record of buying properties with tenants, and CRG West recently said it is targeting sale/leaseback arrangements  that can help companies reduce the capital requirements of their data center operations.
Here’s an overview of the facilities being discussed:
Article printed from Data Center Knowledge: http://www.datacenterknowledge.com
URL to article: http://www.datacenterknowledge.com/archives/2008/08/15/report-aol-to-sell-data-centers-cut-ops-staff/
URLs in this post:
 additional coverage: http://www.datacenterknowledge.com/archives/2008/09/03/aol-data-centers-are-not-for-sale/
 Valleywag: http://valleywag.com/5036850/layoffs-coming-in-aols-datacenters
 Silicon Alley Insider: http://www.alleyinsider.com/2008/8/aol-cutting-datacenter-staff-maybe-twx-
 Emcor Group: http://www.emcorgroup.com/
 Northern Virginia: http://www.datacenterknowledge.com/archives/washington_dc_area-index.html
 Digital Realty Trust: http://www.datacenterknowledge.com/archives/2007/Mar/29/digital_realty_buys_no_virginia_centers.html
 Equinix: http://www.datacenterknowledge.com/archives/2007/Mar/29/equinix_expands_again_in_washington.html
 DuPont Fabros: http://www.datacenterknowledge.com/archives/2007/Nov/01/32_generators_at_new_dupont_fabros_facility.html
 CRG West: http://www.datacenterknowledge.com/archives/2008/Jan/04/crg_west_buys_virginia_data_center.html
 Power Loft: http://www.datacenterknowledge.com/archives/2008/Mar/11/power_loft_readies_first_site_more_to_come.html
 targeting sale/leaseback arrangements: http://www.datacenterknowledge.com/archives/2008/Jun/11/crg_west_offers_build-to-suit_services.html
 bought a former AOL data center: http://www.datacenterknowledge.com/archives/2005/Jul/29/dupont_fabros_pays_58_million_for_aol_center.html
 VA4 data center: http://www.dft.com/data_centers/va4.shtml
 Dulles Tech Center: http://www.ccgfacilities.com/projects/dtc.html
 Manassas Tech Center: http://www.ccgfacilities.com/projects/mtc.html
 Rich Miller: http://www.datacenterknowledge.com/archives/author/richm/
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