PowerHouse Data Centres, an American Real Estate Partners affiliate, has begun demolition of a former AOL headquarters in Sterling, Virginia, where it plans to build a new data centre campus. According to Data Centre Frontier, the corporation, in collaboration with Harrison Street, purchased the 43-acre land for $136 million in 2021.
PowerHouse Pacific will have a maximum capacity of 265 MW and will consist of three buildings totalling roughly 1.2 million square feet, as well as a 2-acre power substation. The demolition is expected to be completed by early 2024, allowing the power substation to begin construction in collaboration with Dominion Energy and be completed in the summer of 2024.
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Two parking garages, three office buildings, one main hub, and a pedestrian bridge are now on the site. Additionally, the structures will begin construction in the autumn of 2024, with completion scheduled for mid-2026. The general contractor will be E.E. Reed Construction.
Where the PowerHouse Data Centres Virginia project is located
The location is located off Pacific Boulevard, about 30 miles from Washington, D.C., and about 5 miles from Dulles International Airport. It is also fewer than three miles from the joint venture’s first data centre project in the area, the 265,580-square-foot ABX-1, which CyrusOne has leased for a 30-year tenure. These two facilities are part of a $1 billion investment in Northern Virginia to build 2.1 million square feet of data centre space.
According to a recent CBRE research, data centre supply in key markets increased by 12% in the first half of 2023, with an all-time high construction backlog for the asset type of 2,288 MW, indicating a 25% year-over-year growth. According to the same source, Northern Virginia has been the best-performing market in the industry, with a vacancy rate of 0.9 per cent. Furthermore, the region continues to draw new investors, as seen by Digital Realty’s recent $1.5 billion joint venture agreement with TPG Real Estate Partners for three local data centres.
