Microsoft Is Leasing The Most Data Center Capacity In US

Data center leasing capacity in the U.S. tripled in 2020 with Microsoft, Facebook and Bytedance (TikTok) leasing the most from multi-tenant data center operators.

Multi-tenant data center operators leased nearly 700 megawatts of capacity in the U.S. in 2020, more than tripling 2019, with Microsoft dominating leasing in America.

The Redmond, Wash.-based software king and public cloud giant leads the nation in leasing more U.S. data center capacity last year than any other company, according to North American Data Centers’ annual data center real estate market report published this week. Microsoft leased 178 megawatts of capacity in Virginia alone in various data centers, as well as leasing in other large U.S. markets including the Bay Area and Phoenix.

The two companies which leased the most data center capacity after Microsoft in 2020 were Bytedance – the Chinese-based company that owns the popular social media platform TikTok – and Facebook, according to the North American Data Centers (NADC) report.

In 2020, the biggest data center provider beneficiaries of leasing were cloudHQ, Aligned Energy and Digital Realty Trust.

[Related: Dell, HPE Lead Public Cloud Infrastructure Spending Binge]

Microsoft, named in CRN’s 10 Hyperscale Data Center Companies To Watch in 2021, is investing billions each quarter on expanding its ever-growing data center footprint to accommodate demand for Microsoft Azure with more than 60 cloud regions in 140 countries.

Microsoft has unveiled plans to build a slew of new data centers across the world in the coming year including in Poland, New Zealand, Mexico, Spain and Israel. The company is also preparing to begin the massive $10 billion Department of Defense JEDI cloud contract it has been awarded on two occasions.

Data center colocation giant Digital Realty leased 190,000 square feet of space to Microsoft alone in its Franklin Park, Ill.-based data center, along with 40 megawatts for Microsoft in its Ashburn, Va.-based center.

There was a surge in data center leasing activity during the second quarter of 2020 from hyperscale companies, as many pulled forward their requirements as a result of the new distributed work force and the work-from-home initiatives stemming from the global COVID-19 pandemic.

NADC noted several other companies that were big data center leasers in 2020 including Oracle, who signed several leases in Northern Virginia and Phoenix totaling over 40 MW. Additionally, Google leased 60MW in Ashburn, Va. from cloudHQ, while Twitter leased 12 MW in Atlanta from QTA and 12 MW from Digital Realty in Hillsboro, Ore.

The COVID-19 pandemic has spurred massive spending increases on data centers from the world’s largest data center operators -- led by Amazon, Google, Facebook and Microsoft -- which spent a record $37 billion in the third quarter of 2020.