Real Estate Developer Builds Space For Containerized Data Center Modules

A real estate developer which also builds data centers has found a twist on that market by providing space for containerized modules instead of complete IT infrastructures.

Pelio & Associates, a Saratoga, Calif.-based real estate developer, has opened a new data center in Santa Clara, Calif., named after its address, 1101 Space Park.

However, instead of gradually filling the 50,000-square-foot building with racks of IT equipment, 1101 Space Park is pretty much an open area designed to accept preconfigured data center modules built into 40-foot and 20-foot containers.

The new facility is different from the company's 10 existing data centers, all built within a quarter-mile of each other, said Jon Shank, an owner of Pelio & Associates.

The company typically buys the land, builds the building, and starts filling it with IT equipment for one or two tenants and up, Shank said.

However, with 1101 Space Park, the company is going completely modular, giving it the flexibility to scale in size as customers need.

"We build the infrastructure and provide the power and cooling," he said. "We make sure customers then get the best solution possible, tailored to their needs."

That solution includes a containerized data center module from companies like IBM, Hewlett-Packard, Oracle, or whichever vendor the customer requires, Shank said.

Customers don't want to pay for a 50,000-square-foot facility just to flip the switch on two or three racks of servers, storage, and networking gear, said Les Pelio, another owner of Pelio & Associates. By using containerized data center modules, customers only have to pay for what they need, and get almost instant access to the new IT resources, Pelio said.

This is a huge shift in data center development, one that shows that the concept of data centers is still in its infancy, Pelio said.

"We just provide the power and connectivity," he said. "Our solution is agnostic to the vendors. It's very simple for us. We provide the space and plug-ins. Whatever the customer wants to use, they just bring it in. The first modular container came in by truck and was ready to go in one hour."

Using containerized data center modules is really all about providing total cost of ownership to data center customers, Pelio said.

Next: Containerized Data Center Modules All About TCO, Flexibility

"Where will customers be in two years?" he said. "It's all about flexibility. Data centers are very cumbersome to build, get permits for, and operate. For us, once we're approved for one container, we're approved for them all."

Brian Canney, global business executive at IBM responsible for the vendor's Portable Modular Data Center, or PMDC, said the total cost of ownership message related to containerized data center modules is huge.

Using an IBM PMDC or similar module can result in a 50 percent cut in capital costs and up to a 70 percent cut in operational costs, Canney said.

"No one knows how much capacity they will need in the future," he said. "The PMDC allows customers to adjust accordingly. They don't need to build now for future capacity needs. They also save on the time needed to build a new data center. For a new data center, in most cases customers need 18 to 24 months to build it. But in the meantime, they need to move more equipment into a collocation facility or some unconditioned space."

With IBM's PMDC, however, a new module with all the required servers and storage can be delivered within 12 to 14 weeks, Canney said. Most of that time is spent on sourcing the needed components, including the chiller unit and generators.

In Pelio's case, however, the time to delivery is even faster, Canney said. "Pelio has its own mechanical (air conditioning) and electrical plant, so we just deliver the IT containers," he said. "So the lead time is about eight weeks, including the racks and internal power and cooling, fire detection and suppression, and remote monitoring and security."

Pelio, which built its first data center about 10 years ago after seeing a tenant in one of its buildings bringing huge amounts of power for its own data center, has done well in the data center business because of its close relationship with Silicon Valley Power, the local public utility for Santa Clara.

"Silicon Valley Power provides the cheapest and most reliable power in California," Pelio said.

The company builds all its data centers next to power substations because of the huge expense required to run new power lines, Pelio said.

"Being next to connectivity and power is the building block to a successful data center," he said. "We won't build outside our area. We're in a pretty golden spot with Silicon Valley Power."