Los Angeles Data Center Market Size
| Study Period | 2020 - 2030 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2030 |
| Historical Data Period | 2020 - 2022 |
| CAGR | 4.50 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Los Angeles Data Center Market Analysis
The Los Angeles Data Center market is valued at 158.55MW in the current year and is expected to reach a CAGR of 4.5% during the forecast period to 217.17MW by the next five years. A data center is a specific area inside a structure or a collection of designs that includes computer systems and related equipment, such as networking and storage systems.
- Los Angeles, home to Hollywood, the world's most famous entertainment industry center, has thriving media and entertainment hubs that contribute significantly to the density of, and ubiquitous connectivity to, the city's data centers. The high pace of movie production each year has been demonstrated to increase data center leasing activity rates in and around the area.
- Los Angeles is one of the most significant cities in the United States, with a population of about four million. Over 82% of this population has broadband internet access, contributing to the vast connection Los Angeles and its data centers enjoy. Los Angeles has a GDP of over US$940 billion, and its data center business is growing to a significant contribution from the digital economy.
- As the rise of AI takes the stage, hyperscale, and edge fuel data center demand. The broad adoption of cloud computing and artificial intelligence (AI) drives exponential growth for the data center business.
- Real estate prices in Los Angeles have surged due to issues such as a scarcity of adequate land, increasing demand from other businesses, and zoning constraints. As a result, land and construction costs have risen significantly, making it harder for data center operators to obtain a satisfactory return on investment.
- The epidemic also increased network and internet traffic due to the work-from-home lifestyle, more internet-based activities, and social media usage. While timelines and schedules are shrinking, data center projects are growing.
Los Angeles Data Center Market Trends
Growing Cloud Applications, AI, and Big Data
- The growing adoption of cloud applications, artificial intelligence (AI), and big data is driving the demand for the data center market. As more businesses and organizations shift their operations to the cloud, they require larger and more advanced data centers to support their needs.
- Cloud applications have become popular in recent years because they enable businesses to access software and services via the Internet rather than installing and maintaining them on their hardware. This has increased demand for cloud-based data storage and processing capabilities, which big data centers usually provide.
- For instance, in December 2022, a new Oracle Cloud Infrastructure (OCI) region officially began operations in Chicago, according to Oracle. The new area, which is Oracle's fourth in the United States and 41st overall, is a public cloud region. The business also runs two general US Government regions, three Department of Defense-specific US Government regions, several US National Security regions, a TikTok plant in Texas, and regions in Ashburn, Virginia, Phoenix, Arizona, and San Jose, California.
- Additionally, the growing data privacy and security requirement is fuelling demand for data centers. Because of the increase in cyber risks and data breaches, businesses and organizations are looking for secure and dependable data storage and processing solutions, which advanced data centers can only offer. The need for data centers will likely increase as businesses and organizations increasingly rely on these technologies to support their operations. This is a significant potential for companies and investors interested in entering the data center market.
High Adoption Of Hyperscale Data Center
- The rising adoption of hyperscale data centers is a significant driver of the data center construction market. Hyperscale data centers are large-scale facilities that are designed to support the massive amounts of data processing and storage required by modern businesses and organizations.
- These data centers are typically owned and operated by cloud service providers such as Amazon Web Services, Microsoft Azure, and Google Cloud, as well as large enterprise companies like Facebook and Apple. Hyperscale data centers are characterized by their massive scale, with some facilities spanning over a million square feet and containing tens of thousands of servers.
- As the demand for digital IT infrastructure grows, hyperscalers and edge data centers are expected to be the fastest-growing segments of the data center market. Indeed, the hyperscale market is predicted to increase by 20% between 2021 and 2026 as more major IT businesses seek to address the rising demand for data processing and storage. With 314 new hyperscale sites under construction globally now, the number is likely to exceed 1,000 by the end of 2024, up from roughly 500 locations just five years ago. According to Uptime Institute, the United States has 53% of hyperscale capacity.
- With hyperscale demand at an all-time high, we anticipate an increase in partial-interest exchanges and forward sales of new builds. Furthermore, rising interest rates will likely boost sale-leaseback transactions for businesses looking to raise capital.
- As a result of these benefits, the adoption of hyperscale data centers is expected to continue to grow in the coming years, driving the demand for data center construction. This presents a significant opportunity for businesses and investors looking to enter the data center market, particularly in regions with a high demand for cloud-based services and applications.
Los Angeles Data Center Industry Overview
The Los Angeles Data Center Market is fragmented in that key vendors are utilizing inorganic growth techniques, such as mergers and acquisitions and strategic partnerships, to increase their market share. Some players include Digital Realty Trust, Inc., DataBank, Equinix Inc., CoreSitea, and Cogent.
In November 2022, EdgeCore Digital Infrastructure, a provider of United States data centers, announced that the firm would receive an investment of up to USD 1.2 billion from Swiss private investment company Partners Group Holding AG. Partners Group would use the Partners' investments in data center assets to purchase majority ownership in EdgeCore and assist it in developing new data center locations around the United States.
January 2021, CoreSite designed LA3, a 160,000+ square foot building with a total capacity of 18 megawatts, in the heart of downtown Los Angeles and adjacent to CoreSite's LA2 plant. The LA3 data center is the city's first purpose-built development from the ground up. CoreSite finished phase one of the LA3 development, including 51,000 square feet and six megawatts of power. Customers can directly access the largest interconnection community in North America while installing in a modern, highly efficient data center.
Los Angeles Data Center Market Leaders
Digital Realty Trust, Inc.
DataBank
Equinix Inc.
CoreSite
Cogent
*Disclaimer: Major Players sorted in no particular order
Los Angeles Data Center Market News
- December 2022: The floating data centers of Nautilus Data Technologies will be brought to Los Angeles. The additions show that its novel strategy of utilizing a water-based platform that taps seas, bays, and rivers to reduce the cost of cooling servers is gaining traction. The new data centers will be housed in port facilities on custom-built barges, with backup equipment on land. Both locations will host a 7.5-megawatt data center, with power and water agreements already in place.
- June 2022: Prime Data Centres is expanding into the Los Angeles market. Prime will construct a 261,000-square-foot facility and a 49.5MVA electric substation to serve the new site, offering its tenants up to 33 megawatts (MW) of vital power once completed. Vernon's municipally owned and run electric utility (VPU) provides power supply and has some of the lowest retail utility prices in the region. Prime intends to construct the facility as soon as the fourth quarter of 2023.
Table of Contents
1. INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. KEY INDUSTRY TRENDS
4.1 Smartphone Users
4.2 Data Traffic per Smartphone
4.3 Mobile Data Speed
4.4 Broadband Data Speed
4.5 Regulatory Framework
4.6 Value Chain Analysis
5. MARKET OUTLOOK
5.1 IT Load Capacity
5.2 Raised Floor Space
5.3 Number of Racks
6. MARKET SEGMENTATION
6.1 By DC Size
6.1.1 Small
6.1.2 Medium
6.1.3 Large
6.1.4 Massive
6.1.5 Mega
6.2 By Tier Type
6.2.1 Tier 1 & 2
6.2.2 Tier 3
6.2.3 Tier 4
6.3 By Absorption
6.3.1 Utilized
6.3.1.1 By Colocation Type
6.3.1.1.1 Retail
6.3.1.1.2 Wholesale
6.3.1.1.3 Hyperscale
6.3.1.2 By End User
6.3.1.2.1 Cloud & IT
6.3.1.2.2 Telecom
6.3.1.2.3 Media & Entertainment
6.3.1.2.4 Government
6.3.1.2.5 BFSI
6.3.1.2.6 Manufacturing
6.3.1.2.7 E-Commerce
6.3.1.2.8 Other End User
6.3.2 Non-Utilized
7. COMPETITVE LANDSCAPE
7.1 Company Profiles
7.1.1 Digital Realty Trust, Inc.
7.1.2 DataBank
7.1.3 CoreSite
7.1.4 Equinix Inc.
7.1.5 Evocative
7.1.6 Telehouse
7.1.7 Hivelocity
7.1.8 Colocrossing
7.1.9 Aptum data center
7.1.10 Cogent
7.2 Market share analysis (In terms of MW)
7.3 List of Companies
Los Angeles Data Center Industry Segmentation
A data center is a physical room, building, or facility that holds IT infrastructure used to construct, run, and provide applications and services and store and manage the data connected with those applications and services.
The Los Angeles Data Center Market is segmented by DC Size (Small, Medium, Large, Massive, Mega), Tier Type (Tier 1&2, Tier 3, Tier 4), Absorption (Utilized (Colocation Type (Retail, Wholesale, Hyperscale), End User ( Cloud & IT, Telecom, Media & Entertainment, Government, BFSI, Manufacturing, E-Commerce)), and Non-Utilized).
The market sizes and forecasts are provided in terms of value (MW) for all the above segments.
Frequently Asked Questions
What is the current Los Angeles Data Center Market size?
The Los Angeles Data Center Market is projected to register a CAGR of 4.5% during the forecast period (2024-2030)
Who are the key players in Los Angeles Data Center Market?
Digital Realty Trust, Inc., DataBank, Equinix Inc., CoreSite and Cogent are the major companies operating in the Los Angeles Data Center Market.
What years does this Los Angeles Data Center Market cover?
The report covers the Los Angeles Data Center Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the Los Angeles Data Center Market size for years: 2024, 2025, 2026, 2027, 2028, 2029 and 2030.
Los Angeles Data Center Industry Report
Statistics for the 2024 Los Angeles Data Center market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Los Angeles Data Center analysis includes a market forecast outlook to for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
