An external view of a data center building

Crucial Keys for Deciding on Your Data Center Location

3 Jan 2017 by Katie Lahman

This article originally appeared on July 17, 2015, and has been revised to bring our readers the most up-to-date technology information.

Is your company looking for a new data center location locally or globally? You could either be looking to cut your energy costs, consolidate locations, or maybe you are starting from scratch. There are multiple considerations you will want to explore during your due diligence. Let’s start from the ground up.

If this process is new to you, you will definitely want a good realtor that specializes in data center spaces. You may also want to hire a service provider that has experience in building and managing data centers with the appropriate specialty skills for the job.

Energy security and sustainability, telecom reliability, the risk of natural disasters, location of end-users, political risks and economic and regulatory concerns are crucial considerations when selecting a location for a new data center facility.

While it’s important that the data center hosts network equipment — website servers, data and back-up servers, software applications — it’s what your hardware and software do that’s that may determine your decision. All of these things essentially control vital data for companies and their clients.

That’s why choosing a data center location is the first (and perhaps most important) step in the entire process. Deciding factors are broken down into two categories: table stakes and customer applications. Table stakes are the minimum requirements a site needs to run a data center. Customer applications involve what is important to the IT operation.

Meeting the minimum resources needed

The first thing a data center needs in order to run is power. Everything starts and stops with power. When choosing the location of your data center, take these power variables into consideration:

Power availability: Choose a location where there’s enough power to run equipment efficiently every day. Decide whether a location can support the long-term power requirements.

Power sustainability: Certain locations may have access to cleaner sources of energy than others, which may or may not be a priority for your company, if you have data centers in the US, it’s on the government’s radar. According to, there’s an initiative to “install and monitor advanced energy meters in all data centers by fiscal year 2018.”

Power affordability: Power consumption of data centers worldwide increased by 100% from 2010 to 2015, according to That big leap should make you wonder, how much more power will our data centers require in the coming years?

Cushman & Wakefield put together the Data Centre Risk Index 2016, which evaluates countries globally on multiple factors, including power affordability.

Thankfully, with advancements in technology, and all-in-one appliances and virtualization software that manages resources better, less space will be needed to house, heat and cool your equipment. But data demands are only increasing, and it’s better to plan for affordable power than risk building your data center where utilities are at a premium. Locate your data center where power rates are the most economical in relation to proximity from end-users.

Structural considerations: Choose a location that can adequately safeguard server equipment. describes several potentially disastrous structural scenarios, like building your data center in a basement, or in a building that used to be something else. To their point on the latter issue, it’s harder to make a building suitable for data center resources that was created for a different purpose. They also address data center colocation in the report.

Network access: Select a place where content can be easily accessed. While this used to be a top consideration, in the last 10-15 years high-speed network infrastructure has improved vastly. As have the capabilities to monitor and run data centers remotely.

Environmental considerations: Find a location safe from natural disasters, like earthquakes, hurricanes and flood zones.

Performance and fundamental considerations

Latency, as it relates to customer applications is a major concern for companies when choosing a data center. These apps deal with platforms that needs to reside as closely as possible to customers so it can be delivered as quickly as possible. In addition to the proximity to end-users, economic and regulatory considerations must be taken into account.

Taxes: Did you know some locations offer tax incentives to encourage data center construction? Datacenter Dynamics put together a great list of US tax breaks by state. There are 33 states offering incentives, according to the list.

You may also want to look at corporate taxes are locally or globally, again, depending on where your end-users are. Cushman & Wakefield put together the Data Centre Risk Index 2016, which evaluates countries globally on multiple factors, including corporate tax. Their data center maps also show their overall best choices for data center locations globally.

Connectivity: Make sure your location enables you to meet all the connectivity requirements. Some mission critical applications may require immense connectivity requirements. Depending on the scale of your company, you may need these applications to perform for customers and employees at just one location, or at remote offices around the globe. As with network access, this too is less of an issue than it was 10-15 years ago.

Staffing: Hire employees with the appropriate certifications to ensure the data center runs efficiently. Thankfully, this is getting easier with the advancements in data center resources like hyperconverged infrastructures, which require less specialty knowledge, and fewer human resources.

Ability to Expand: Select a location that can accommodate growth and change with your organization’s evolving needs. With increasing demands on the data center, and your company’s growth, you will need to consider long-term plans when choosing a location.

Many cloud leaders like Microsoft choose data center locations based on major areas of internet traffic growth, according to

It takes a lot of research and analysis to build a successful data center. The result is a highly efficient data center facility in a low-risk, cost-effective location. This list is not mean to be exhaustive, but more of an overview of important considerations.

Learn more about what goes into researching and analyzing your data center location in this video by our partner, APC by Schneider Electric. For more in-depth data center questions, talk to an experienced Insight specialist.

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