Officials in Garner confirm that they are aware of a data center project for a large company that currently has local operations. The Garner officials haven’t identified the prospect, but Fidelity has an existing data center in Research Triangle Park and acknowledges that it is seeking additional space. “Fidelity is planning for incremental growth beyond the capacity we have at our existing data center facility, and we are engaged in active negotiations that are progressing well,” Fidelity spokeswoman Jennifer Engle told the Triangle Business Journal. “We believe this is good news for North Carolina and reinforces our commitment to the state.”

Garner Mayor Ronnie Williams said the data center project was discussed by the Town Council in a closed session Thursday evening. Williams told the News & Observer the town has not been told the identity of the company, which is considering a site in the Greenfield South industrial park near the intersection of U.S. 70 and Interstate 40.

The new data center would provide Fidelity with data centers on two different power supply systems. The company’s current Triangle center pulls its power from Duke Energy, while the site in Garner would use Progress Energy as its utility. Fidelity purchased its current data center building and equipment from Credit Suisse in 2007 for $108.6 million, the Business Journal reported.

T5 Partners would like to help accelerate the trend. T5 is a data center development company led by former data center specialists with The Staubach Company. After years of performing data center site selection for enterprise clients like T-Mobile and E-Trade, the T5 team decided to focus on the other side of the business.

The company is now developing existing structures and sites that can be quickly converted into major data centers, and is focusing its initial efforts on marketing two properties near Charlotte for data center development.  

NC Wants Data Centers
“Choosing North Carolina first is no accident,” said Peter Marin, president of T5 Partners. “It’s based on the cost of power, incentives, low taxes and bringing the infrastructure together. The incentives are aggressive in North Carolina on purpose. They want to attract data centers.”

T5 doesn’t discuss its current clients, but the company is known to be working closely with officials in Catwaba County, where Apple is building a new $1 billion data center campus. State and local incentive packages are expected to result in about $46 million in rebates to Apple over the next 10 years.

T5 is focused on sites with existing structures and industrial-strength infrastructure in place, including adequate power and water supplies. The local utility for both its projects is Duke Energy, wich offers industrial power rates as low of 4 cents per kilowatt hour. T5’s target market is Fortune 500 companies who want to control their own data center, but have a tighter time frame that may not work with a ground-up “greenfield” construction project.    

“The option to fund and lease these facilities is very attractive,” said Jason Chartrand, executive vice president of T5 Partners. “Our buildings are basically ready to go and ready for tenant improvement.”

Sale/Leaseback As An Option
Chartrand noted that T5 is also working on arranging sale/leaseback deals, in which a property owner sells their building, 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. 

For companies looking for a wholesale data center solution, T5 is working with Power Loft, which recently opened its first data center in Manassas, Virginia. “We’re able to address the speed-to-market issue with Power Loft,” said Marin. “We can get someone operational in 90 to 120 days.”

Both Power Loft and T5 Partners are backed by the real estate investment fund Iron Point Real Estate Partners, a real estate fund with offices in Washington, D.C. and Dallas.

In August we noted the packaging of the region spanning Catawba and Caldwell counties as the “Apple-Google data center corridor.” This week the effort expanded to include economic development agencies in Burke, Alexander and Iredell counties.

Officials from the five counties joined together to host a Data Center Information Exchange Tuesday and Wednesday in Maiden, North Carolina near the construction site for Apple’s new $1 billion data center. The event attracted about 40 site selection specialists who help clients choose where to build data centers.

The collective marketing effort hopes to capitalize on the trend towards data center clustering, in which high-profile projects highlight an area’s attractiveness for data center development. In recent years this phenomenon has helped boost the fortunes of central Washington state and San Antonio, Texas, among other destinations.

Harry Whalen, director of the Economic Development Commission of Caldwell County, likened the effect to the fast food industry. ”When you see a McDonald’s, you’ll often see a Burger King,” he told the Hickory Daily Record.

Apple’s planned $1 billion data center in Maiden is just 25 miles from a huge Google data center complex in Lenoir.

North Carolina has always had data centers in the Raleigh/Durham area, which is home to Research Triangle Park and data centers for companies including IBM, NetApp, Ralph Lauren, Peak 10, Hosted Solutions and DataChambers. In late 2006 Google began scouting sites in North Carolina, and began negotiating a tax incentive package with state and local legislators. This led to Google’s January 2007 announcement that it would invest $600 million in a major data center in Lenoir, a small town previously known for its furniture industry.

Catawba County economic development director Scott Millar noted that the region’s data center events are becoming more popular. “Eight (consultants) came the first year, 18 came last year and 38 came this year,” Millar said. “We’re getting attention.”

Local media report that EMC Corp. has bought the Essex Center building in Durham from Crown Realty & Development of Irvine, Calif. Last month EMC announced a $280 million expansion plan in the Triangle over the next five years. The company said the new data center and research and development lab would totaling 260,000 square feet of space within the Essex building.

The exterior of the new NetApp data center in Research Triangle Park, North Carolina.

Today NetApp (NTAP) is opening the doors to its new energy-efficient data center at its campus in Research Triangle Park (RTP), North Carolina. The new facility will enable NetApp to consolidate its engineering facilities into a global dynamic lab (GDL) and will house NetApp’s IT operations.

The 132,000 square foot facility houses a 36,000 square foot data center supporting 2,166 racks of IT equipment with a designed power load of nearly 25 megawatts.

Estimated PUE of 1.2
The NetApp data center was designed with numerous features to reduce the energy needed to power and cool those servers, which the company estimates will result in a Power Usage Effectiveness (PUE) rating of 1.2.

The PUE metric (PDF) compares a facility’s total power usage to the amount of power used by the IT equipment, revealing how much is lost in distribution and conversion. A rating of 1.2 would place the NetApp facility among the most efficient data centers in the world, in roughly the same class as facilities operated by Google and Microsoft.   

NetApp estimates that its focus on energy efficiency will generate savings of $7.3 million a year on the company’s power bill and reduce its CO2 output by 93,000 tons a year – the equivalent of removing 15,400 cars from the road.

The energy effiency features at the RTP data center include:

• Running Warmer: NetApp says its average supply air temperature will be 74 degrees, slightly higher than the 68 to 72 degree range seen in many data centers. 
• Airside Economization: The data center will be cooled using just outside air (free cooling) for an estimated 67 percent of the year.
• Pressure Control: Modulating fans, based on NetApp’s proprietary technology, supply pressure-controlled rooms and regulate the volume of air to avoid oversupplying air and wasting energy.
• Cold aisle containment: The cold and hot air aisles are isolated to protect supply air temperatures from being affected by hot air returning from the racks.
• Overhead air distribution: Instead of pumping cold air up through a raised floors, overhead air distribution takes advantage of cold/hot air buoyancy and eliminates ductwork and energy needed to power fans.

NetApp said its software will help improve data management and storage efficiency in the data center. The company will use virtualization to build a private cloud environment to provide virtual access for NetApp engineering labs around the world.

“It’s my understanding that they want to have bulldozers on-site in mid-August,” said Scott Millar, execurtive director of the Catawba County Economic Development Corp. “They’re moving ahead rapidly with permitting and acquiring the land, with the intent of hitting the ground running.”

That’s an ambitious schedule. The company announced its selection of North Carolina on June 3, and attended an event July 6 in Maiden, North Carolina to announce local incentives. The company has yet to acquire the land in Maiden, but Millar said he anticipates that should come together quickly. The Catawba EDC owns options on a 183-acre tract of land that comprises most of the site, and will be assigning those to Apple once the company acquires several adjacent plots that will also be included in the campus.

The company hasn’t officially confirmed that Maiden is the site, but is working with Maiden officials on specific plans for sewer service and amendments to local zoning for data center use.

Millar said Apple’s plans call for a single 500,000 square foot data center structure. The site has a 36-inch water line, dual fiber lines available and a 100 kilowatt power service from Duke Energy. Millar said he expects Apple will be paying close to 4 cents a kilowatt hour for power.

The facility will serve as Apple’s primary East Coast data center. “Their initial commitment is only to the single facility and a $1 billion investment,” over the next 10 years, Millar said.

The Apple data center is expected to bring 50 full-time jobs and 250 temporary construction jobs to a an area that has been hard hit by the economic downturn. Catawba County has an unemployment rate of 15.5 percent.

The new North Carolina facility will be nearly five times the size of the 109,000 square foot Newark, Calif. data center Apple bought in 2006 to support its growing infrastructure. Apple also operates a data center on its Cupertino, Calif. campus, and has used content delivery networks from Akamai (AKAM) and Limelight Networks (LLNW) to distribute content to its users around the globe.

• Several reports have noted Apple’s refusal to confirm that Maiden will be the site for the new facility. That’s because the land is still being acquired. The Catawba County Economic Development Corp. has an option to purchase the 183-acre site off Route 321, according to executive director Scott Millar, who told the Charlotte Observer that the EDC plans buy the land at market value from its current owner and then sell it to Apple at the same price.
• North Carolina officials are hoping they can leverage the one-two punch of hosting huge data centers for the two hottest technology companies. Google has a large data center complex in Lenoir in Caldwell County. “Having Google and Apple here can absolutely put this region on the world map,” Caldwell County manager Bobby White told the Hickory Record. “I hope the two counties and the involved municipalities will be able to cooperate on some joint marketing ventures. It’s a great marketing tool.”
• The Observer looks at the pitched competition among between four North Carolina counties hoping to land the data center project, with a closer look at the aggressive incentives from Cleveland County.

When a large company looks for a site for a major data center, it’s almost always a multi-state process. Issues like power costs, the suitability of a site for using free cooling and the availability of recycled water have been major site location factors in recent data center decisions.

But nowadays, the decision often boils down to tax incentives. Want to see a local politician spring into action? Tell them that the billion-dollar project that was about to make them a local hero will instead be headed to the state next door. Unless, of course, the official can arrange for a favorable tax situation that can tip the balance in their favor.

This process goes on all the time, yet we rarely see it in action. But the exception is the state of North Carolina’s courtship of Apple. The state recently released e-mails revealing how the state responded to a competitive threat for neighboring Virginia with a speedy tax break that won the Apple deal.

Here’s a summary of the sequence of events, as outlined by the Charlotte Observer:

“The company informed Peggy [Anderson] and me they are stepping things up with the State of Virginia and will revisit there on Monday and Tuesday,” Dale Carroll, chief operating officer at Commerce, wrote in a March 28 e-mail to nine others at Commerce, the Department of Revenue and Gov. Beverly Perdue’s office. Two days later, an Apple representative sent Commerce Secretary Keith Crisco an e-mail with suggested legislative language to change the corporate tax formula. For much of April, talks took place between Commerce, the governor’s office and legislators on the details of a measure. In May, the bill was introduced in the Senate Finance Committee, and less than a month later it was signed into law by Perdue.

By late March it was well known that Virginia legislators were preparing their own package of incentives for data center operators. Virginia officials insist their incentive program is a way to enhance its attractiveness for data centers – which are already a major industry in northern Virginia – ratehr than a response to any specific requirement.

While not playing favorites among regions within Virginia, the state is touting the availability of sites in southern Virginia, where there is less competition for power. An example is GigaPark, which is organized by the Mid-Atlantic Broadband Collective.

For projects in southern Virginia, the competition is North Carolina. And on the Apple data center, the company’s threat to shift its focus to Virginia encouraged North Carolina legislators to rapidly provide the company with the incentives it desired.

Apple Inc.

The new North Carolina facility will be nearly five times the size of the 109,000 square foot Newark, Calif. data center Apple bought in 2006 to support its growing infrastructure. Apple also operates a data center on its Cupertino, Calif. campus, and has used content delivery networks from Akamai (AKAM) and Limelight Networks (LLNW) to distribute content to its users around the globe

The new site is slated to be built on a 255-acre site in Maiden, bringing 50 full-time jobs and 250 temporary construction jobs to a an area that has been hard hit by the economic downturn. Catawba County has an unemployment rate of 15.5 percent. The Catawba EDC web site has already posted links for local suppliers and prospective employees to contact Apple.

Maiden and Catawba County agreed Monday on $7.3 million in incentives for Apple. The new Apple facility will be the company’s East Coast operations center. A document filed with the state indicates the data center will “take advantage of 3 hour time change on the East Coast to facilitate communications between European operations/sales and California for data transmission.”

The North Carolina Department of Commerce projects that a data center investment of $1 billion would create more than 3,000 jobs in the regional economy, including hundreds of jobs related to construction and others created as a result of economic growth.

The incentive legislation mandated that the data center be located in an economically struggling rural area of the state and pay above-average salaries.

On June 3 Apple confirmed that it will invest more than $1 billion over nine years in a data center campus somewhere in North Carolina, but did not announce the site. The facility will provide Apple with a major East Coast infrastructure hub to support its iTune music store and iPhone app store.

The project will bring at least 50 high-paying jobs to Catawba County, where the unemployment rate was 15.5 percent in May, up from 15 percent in April.

Reports about Apple’s site location process have focused on properties just off Route 321 in Maiden, where the Catawba County Economic Development Corp. has been marketing several properties for data center use. Apple has said it is in the process of acquiring a site. But there are strong indications that the choice has been made, and the facility will indeed be built in Maiden.

On Monday, July 6 members of the Maiden Town Council will join representatives of the Catawba County Board of Commissioners and the county’s Economic Development Corp. to make an announcement at the Maiden Recreation Center. Maiden mayor Marcus Midgett told local media that the announcement will “probably involve a new industry coming to Maiden.”

So where in Maiden will the iDataCenter be located? Local officials have been touting several sites with excellent power and fiber infrastructure for data center use.

Catawba County officials have been working with T5 Mission Critical Facilities, a company formed recently by former members of the data center practice at the Staubach Company. T5 is developing a site near Route 321 in with an existing 150,000 powered shell with up to 120 megawatts of power available for a single large user. The company says the power from Duke Energy is priced at 3.8 to 4.4 cents per kWh.

The new Apple facility will be the company’s East Coast operations center. A document filed with the state indicates the data center will “take advantage of 3 hour time change on the East Coast to facilitate communications between European operations/sales and California for data transmission.”

The North Carolina Department of Commerce projects that a data center investment of $1 billion would create more than 3,000 jobs in the regional economy, including hundreds of jobs related to construction and others created as a result of economic growth.

The incentive legislation mandated that the data center be located in an economically struggling rural area of the state and pay above-average salaries.