TOTOWA, NJ-San Francisco-based Digital Realty Trust, Inc. has purchased a 271,000-square-foot warehouse at 701 Union Boulevard here to redevelop it as a data center.
The building, which once served as the printing center for Hoffman La-Roche (now Roche pharmaceuticals), is set on 34 acres. The property fetched $16.8 million. CBRE’s Kevin Welsh and Tom Mallaney orchestrated the trade.
"With our current portfolio in the New York Metro market nearing capacity, this new site enables us to add inventory to meet future demand for highly reliable data center space in this key corporate enterprise market," said Michael F. Foust, Chief Executive Officer of Digital Realty. "Its location also adds geographic diversity for customers looking to deploy mission critical business applications outside of Manhattan."
The site is 20 miles from the George Washington Bridge.
Digital Realty announced plans to equip the existing building to handle 15.75 megawatts of critical IT load. In the initial phase, the company said it would rely on area substations w to supply power. Later, the company plans to build a 50 MVA substation on the site to support additional data center capacity.
"Based on our conservative underwriting, we expect to generate attractive risk-adjusted returns on this investment," said Scott Peterson, who is acquisitions officer for the firm. "With the redevelopment opportunity of the existing building coupled with the additional land available for new development, we believe this investment has considerable upside potential."
Digital Realty’s has about 100 patented “Turn-Key Flex” facilities in 32 markets throughout Europe, North America, Asia and Australia. Each has its own dedicated electrical and mechanical infrastructure.
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