QTS to Launch Huge Chicago Data Center in July

QTS Realty Trust is on the final stretch of the first phase buildout at its first Chicago data center in the former Chicago Sun-Times printing plant. The company bought the 317,000-square foot building in 2014.

Chicago is an active data center market with tight supply downtown but a lot of capacity in the suburbs, according to the latest report on North American data center markets by Jones Lang LaSalle. While the QTS building is not downtown, it is about three miles west, and its location is a significant advantage over facilities in the suburbs, 30 to 40 miles away, said Dan Bennewitz, COO for sales and marketing at QTS.

A lot of demand downtown is driven by companies wanting to be in or close to 350 East Cermak, a major network interconnection and data center hub.

350 East Cermak in Chicago is a key hub in the region's digital economy and one of the most connected buildings in the country. (Photo: Rich Miller)

QTS had been eyeing the Chicago data center market well before it acquired the Sun-Times building, Bennewitz said. It waited until it could buy the plant, however, because the building fit in its strategy of buying and retrofitting large infrastructure-rich properties cheaply.

“We had our eye on the Chicago market for multiple years,” he said. “Over the last year, the opportunity in Chicago has actually gotten stronger.”

Chicago is one of several US markets QTS expects to expand in this year. The others are Richmond, Virginia; the Atlanta metro; Dallas-Fort Worth; Santa Clara, California; and New Jersey.

The company, which provides a full range of data center services, from wholesale and retail colocation space to managed hosting and cloud, is primarily targeting Fortune 500 companies in Chicago. But it is also going after healthcare, financial services, high-tech or digital media companies, as well as government customers, Bennewitz said.

Raised floor inside the new Chicago data center by QTS (Photo: QTS)

The company expects to bring the first phase online in July. It will have about 8MW of power.

No major anchor tenant has signed up to use the data center, but QTS has already secured commitments from several colocation and managed services customers, Bennewitz said.