QTS Reports Strong Sales Momentum in Upcoming Dallas Data Center

QTS Realty Trust has pre-sold about 26,000 square feet of space in its Dallas-Fort Worth data center ahead of launch, expected this quarter. Construction began in late 2013.

QTS has been on a mission to diversify its clientele beyond its sizable Atlanta position, and early success in the Dallas market indicates that it has hit the ground running in that market.

Its annual SEC filing in 2013 indicated plans to invest up to $277 million in adding more than 300,000 square feet of data center space – most of it in the Dallas facility and in Richmond, Virginia.

QTS has a strategy of buying massive properties at a discount. In Irving, Texas (a Dallas suburb), it acquired a 700,000 square foot former semiconductor plant. In other markets, it acquired the former Sun-Times plant in Chicago and McGraw Hill’s former New Jersey data center to grow presence in those markets.

The building in Irving was previously used by several companies. It sits on a 40-acre campus in the Las Colinas area and has potential to double the size of the footprint to 1.4 million square feet. The campus is powered by an on-site 140MW dual-fed substation and has diverse fiber connections, allowing QTS to offer carrier-neutral space. It’s expected to house up to eight custom data center rooms ranging from 25,000 to 27,000 square feet.

The company offers three lines of service, dubbed as the "3Cs": custom, colocation and cloud and managed services. All three will be available at the new facility.

The Dallas data center market continues to be a hotbed of activity, given its location in the country, good connectivity and friendly business environment. In addition to data centers, several major hosting providers, such as Rackspace and SoftLayer (now an IBM company) got their start in the area.

In terms of recent activity, Equinix held a grand opening for its sixth data center in Dallas last June. CyrusOne has been doing well in the area, adding both data halls and customers, including Wikimedia. zColo, the colocation division of Zayo acquired Dallas provider CoreXchange in March. T5, in nearby Plano, has been expanding at a significant clip as well.

Despite all of this activity and space coming online, QTS was able to pre-sell a sizable chunk of space of its facility before opening, which bodes well for both the market and the data center provider.

"We're proud to announce the signing of the first customers at our Dallas Fort-Worth facility, particularly those that utilize more than one of our mega data centers and a combination of QTS' 3Cs," QTS COO Dan Bennewitz said. "This site's central location, ample power capacity and rich networking connections provide a strong foundation for our unique platform."