After a slow start, leasing has picked up at the Chicago-area data center built by DuPont Fabros Technology. The company has now leased all 122,000 square feet of raised-floor space in the first phase of the huge CH1 facility in Elk Grove, Ill., and is contemplating when to commence construction on Phase II.
"It is likely this will be our next development," said DuPont Fabros president and CEO Hossein Fateh. "Given our current development schedule, ideally we would like to have this space available in the first half of 2012."
Financing is First Priority
Fateh addressed the company's development plans Thursday in DFT's quarterly earnings call with analysts. While DuPont Fabros is eager to expand in Chicago, it will need about $160 million to complete the build-out.
"No date has been set because there are many variables," said Fateh. "We would not begin the development without securing the appropriate capital, which in this case may include utilizing our undrawn $100 million line, unsecured debt, perpetual preferred or some combination. At this point, we do not plan to issue common equity for this development. But the form of funding is always dependent on the condition of the capital market."
"Two of the leases are with existing Northern Virginia tenants and the third is a new tenant in the financial services industry," said Fateh. "The existing tenants include an enterprise tenant and a reseller. This reseller is in several of our Virginia properties, VA3, ACC4 and ACC5 Phase I."
The Virginia tenant was interested in expanding its presence in the New Jersey market, so a swap was arranged. "We mutually agreed to take back into inventory this tenant's computer room in Phase II of ACC5," Fateh said. "We need a small amount of available space in Virginia until ACC5 Phase I is delivered; otherwise we could possibly miss out on a high-growth tenant that has an immediate need for space. Moving this tenant into NJ1 allows us to keep an extra 2.275 megawatt in ACC5 Phase II."
No customers names were mentioned, in line with DuPont Fabros' practice. But the reseller tenant fits the description of Net2EZ Managed Data Centers, and the "high-growth tenant" sounds a lot like Facebook.