How Much Does It Cost to Build a Digital Giant? 💰 The Costs of a Data Center

Building a data center is a massive investment, but essential for modern digital infrastructure! As a general rule, the construction cost of a data center ranges between $600 to $1,100 per gross square foot, or between $7 million and $12 million per megawatt of commissioned IT load. To put it into perspective, a 700,000-square-foot, 60-megawatt data center in Northern Virginia could cost between $420 million and $770 million. 🤯.

So, where does all that money go? Data center construction costs are divided into four main categories:

1. Land and Building Shell (15% to 20%): This includes the building framework and the raised floor.

2. Electrical Systems (40% to 45%): This is the largest portion! It includes backup generators, batteries, Power Distribution Units (PDUs), Uninterruptible Power Supply (UPS) systems, and switching/transformer equipment.

3. HVAC/Mechanical/Cooling Systems (15% to 20%): To keep IT equipment cool, this includes Computer Room Air Conditioning (CRAC) units, Computer Room Air Handler (CRAH) units, chillers, chilled water storage, and piping.

4. Building Fit-Out (20% to 25%): This covers office areas, Meet-Me Rooms (MMRs), and shipping/receiving areas.

It’s important to note that data center operators generally do not own the server, storage, or network equipment that is housed within their facilities — their business is the infrastructure itself!

Some key factors that influence the cost per megawatt include:

• Power Density: The more power required within a fixed space (high density), the greater the additional cooling capacity needed — which increases costs.

• Redundancy/Resilience: To minimize downtime, data centers build redundancy into their systems (e.g., N+1 or 2N configurations). As the level of redundancy increases (from Tier I to Tier IV), construction costs also rise significantly. A Tier IV data center, for example, can cost between one 25% and 40% more than a Tier III facility..

• Scale: Large-scale data center developments and portfolios enable greater purchasing power, resulting in more cost-effective acquisition of electrical systems and HVAC components. This leads to lower unit costs for data center construction projects.

• Time: If a data center is required within very specific and short timeframes, it can be more expensive to build.

Additionally, projects that involve brownfield redevelopment (“brownfield”) can offer a significant cost advantage, saving millions of dollars per megawatt by repurposing existing buildings such as former semiconductor fabrication plants or printing facilities. QTS Realty Trust, for example, has reported a 10% to 15% cost advantage when reusing existing buildings, resulting in an average construction cost of $7 million to $8 million per megawatt for its brownfield redevelopment approach.

Understanding these elements is essential for anyone looking to invest in or grasp the complex world of digital infrastructure. Electrical design is truly the backbone of the data center! 🏗️💡

Sources: “How Much Does it Cost to Build a Data Center? – Dgtl Infra”