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Microsoft, ByteDance, Facebook Leased More US Data Center Space Than Anyone in 2020

Companies leased three times more multi-tenant data center capacity last year than in 2019.

While the data center sector in some of the emerging Asian, European, and Latin American markets is now growing faster than in the mature US market, the growth rate in the US is nothing to sneeze at.

Customers leased close to 700MW of capacity from multi-tenant data center operators in the US last year – more than triple the amount leased in 2019, according to North American Data Centers, a real estate broker specializing in data centers.

Microsoft, Facebook, and TikTok owner ByteDance drove a big chunk of that total number, leasing more US data center capacity in 2020 than any other company, according to this year’s edition of NADC’s annual US data center real estate market update, published Monday.

The data center providers that benefitted from these three hyperscale tenants’ massive infrastructure investment most were CloudHQ, Aligned Energy, and Digital Realty Trust.

Of the three hyperscalers, Microsoft was the biggest spender last year, leasing 190,000 square feet of space from Digital Realty in Franklin Park, Illinois, 60MW of capacity from CloudHQ in Manassas, Virginia, 40MW from Digital Realty in Ashburn, Virginia, plus eight more leases on east and west coasts and in the Midwest, according to NADC.

ByteDance emerged as one of the top hyperscale customers for data center providers to chase after. Despite the turmoil caused by the Trump administration’s threat to ban TikTok in the US unless spun off from its Chinese parent, ByteDance leased more than 130MW of data center capacity in the country last year.

Its two biggest leases, more than 50MW each, were in Ashburn – one with Aligned and the other with Digital Realty. ByteDance also signed another, 20MW deal in Ashburn with Digital, and an 8MW deal with Vantage in neighboring Sterling.

Facebook expanded its capacity in Ashburn with a 72MW lease with CloudHQ, and added 3.5MW in Richmond, Virginia, and 2MW in Chicago through deals with QTS Realty.

In addition to leasing capacity from specialist data center providers, Facebook and Microsoft are also building their own data centers. They – and other operators of hyperscale cloud platforms – typically turn to providers for capacity in the crowded top-tier data center markets, where land is expensive, and where providers compete aggressively for their business.

They tend to build their own, sprawling data center campuses in remote areas, with plenty of cheap land, low energy costs, and attractive tax incentives from local governments eager to boost economic activity.

Other notable companies that were especially active US data center lessees in 2020 include:

  • Bloomberg, which signed a 150,000-square foot lease in Totowa, New Jersey, with Digital Realty
  • Twitter, which took 12MW with QTS in Atlanta and 12MW with Digital Realty in Hillsboro, Oregon
  • Oracle, which signed seven leases across multiple markets totaling more than 40MW with QTS, Iron Mountain, Digital Realty, CenturyLink, Vantage, and NTT
  • Uber, which signed a 10MW lease in Sterling, an 8MW lease in Atlanta, and a 5MW lease in Ashburn with QTS
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