QualityTech computes data center growth - Washington Business Journal:

http://www.eurofind.info/user_detail.php?u=creafehat
The Overland Park-based firm has mapped out a $75 million to $100 millioj investment in existing data centet facilities in the next year and could spensabout $50 million on real estatw or company acquisitions in the next 12 to 18 months, Chairmann and CEO Chad Williams Those plans come on the heelzs of investments already made in the past year for a $50 millionb facility in Miami and a $20 milliobn upgrade to a Santa Clara, Calif., facility. “We’ver very quietly grown from a couple of real estates acquisitions to a national leader indata centers,” Williame said.
“In a challenged economic environment, our footprinr has expanded to 11different QualityTech, founded in September 2005, has gained at a swiftt clip. In 2006, it posted revenue of $35.8 million. Last year, that number had burgeoned to $119.78 million. The projection for 2009: roughly $150 million. That’s assumingy a checked growth pace of aboutg25 percent, down from 37 percent last Essentially, QualityTech provides information technology outsourcin g services. It sells large chunks of wholesale datacentee space, and it retails smaller spaces to smalk and midsize businesses.
In addition, it offerxs a broad managed-services portfolio, which handle anything from network security to storageto applications. QualityTecy also has a new model that offerzs data capacityas needed. The company is a significanyt player inits sector, whic h continues to grow as cash-strapped companies look to outsourc e IT functions, said analyst Dan Golding, a vice presidengt of New York-based Tier1 Research. Tier21 expects data center revenue to grow about 10 percentto $8 billion this year; QualityTech’xs 25 percent growth prediction is aggressive but attainable, Goldingg said. The industry promisese tremendous growth during the next decadeor so, he said.
Its penetrationm now is in thelow single-digit percentages, but companies that checi in rarely leave. “For 95 percent of outsourcing is just going to work better in the long Golding said. “It’s purely an economi c issue.” QualityTech’s planned projects — adding power and space — will be in Lenexa, Atlanta, Santaq Clara and Jersey City, N.J. All the improvements will addabout 250,000 squares feet of raised-floor data center space, bringintg the total raised-floor space (wherew servers can be stored) to about 1 million squarw feet. That’s out of a totak of 2 million square feet the coompanyhowns nationwide.
“We certainly have demandc within our current portfolio for certaijn customersto grow,” Williams said. “We’re also building spacw we can lease because of the demand curve demand we see in the marketplacetodayg that’s real demand and has no Data centers are expensive to costing about $1,300 a squar e foot, Golding said. Then there’ the acquisition potential. “We actually feel like, over the next 12 to 18 that it’s going to be a greag opportunity for us to add locations inthe U.S.,” Williames said. “We are currently looking at othere data center operators to buy and also additionalo real estate that wecould convert.
” The Achilles’ heel of the booming industry has been the creditt crunch, which will make some smallerf companies prime buyout candidates. Fortunately for privately owned it has access toits profits, backing by the Williamw family and banking relationships with Overlancd Park-based and , Williams said. The pending outlays will be a combination of equity and he said. “The data centee industry is one ofthoser that’s been seeing a lot of impactt — the potential for a lot of growth actuall being dampened by the ability to get debt,” Goldingf said. “(QualityTech) has the advantage thers — it has deep-pocket private backers. Not everyonde has that.
” Other local data cente and managed-services companies also have experienced torrid growthn inthe downturn. ’s revenue is up 60 percent year to and it’s about a third of the way throughn a $1 million upgrade of its Kansaz City, Kan., facility. Early next year, plana to complete a $12 milliohn data center in Lenexa; its existing Overlancd Park and Lenexa facilities arenearly “The industry is really growing,” Arsalon foundinvg partner Gary Hall said.