Even as its primary Northern Virginia data center landlord prepares another seven buildings to house its servers, Amazon continues to secure more runway for expansion in the world’s most important data center market.
An Amazon subsidiary recently bought a 100-acre land parcel in Chantilly, a small town south of the Dulles International Airport and Ashburn, the Northern Virginia market’s epicenter, where the supply of available land for data center construction is running short.
Its shortage of land has pushed up real estate prices in Ashburn and sent data center developers looking at nearby towns to continue building in the area, attractive because of the opportunity to interconnect with the networks of companies in all the existing data centers there.
Virginia is home to the largest availability region of Amazon Web Services, the cloud business that’s Amazon’s primary profit driver.
According to Washington Business Journal, which reported the land deal, Amazon bought its parcel for $73 million. That’s well below the $1 million-per-acre price some recent deals in Ashburn have commanded.
The Amazon subsidiary listed as the parcel’s buyer is Amazon Data Services, WBJ reported. Another subsidiary that’s bought land for data centers on the parent company’s behalf over the years is Vadata.
The company that builds most buildings for Amazon data centers in Virginia is Corporate Offices Property Trust. COPT stands up building shells, with the tenant fitting them out with all the necessary data center infrastructure.
Vadata was COPT’s second-largest tenant by percentage of annual revenue (9.2 percent) as of one year ago, occupying about 3.1 million square feet of COPT-owned data center shells, the real estate investment trust said in its first-quarter 2019 earnings report.
COPT CEO Steve Budorick said in April that the developer was on the hook to deliver another seven data center shells for Amazon over the following 24 months.
