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Q&A: Alex Twining, MetroNexus

Carrier Hotels Staff Posted Mar 1, 2004

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Alex Twining is President and CEO of MetroNexus, a Morgan Stanley Real Estate Funds Enterprise developing 3 million square feet of mission critical data centers in Atlanta, Houston and metro New York City. Twining previously managed $3 billion of Morgan Stanley’s most complex office, apartment, retail and hotel investments, with a focus on large scale development properties. Prior to joining Morgan Stanley in 1998, Mr. Twining was a real estate developer for over 20 years.

1. What's your take on the "State of the Industry?" What do you see as the most important developments and trends of the past year?

The most important trend in metro NYC is that almost all of the existing busted colo facilities were absorbed. In Atlanta, there are still many to go. Amazingly, companies like Citicorp have committed to build a brand new mega data center in NJ instead of taking up some of "carrier hotel" space like our 1.2 million square foot facility (in Jersey City). The financial services industry is still quite muddled about the appropriate response to the SEC regulations. There continues to massive confusion in the market, and people are still not making a lot of commitments.

2. How have bankruptcies and their outcomes affected the competitive landscape? Has it been more or less disruptive than you expected?

Bankruptcies have created our competition by providing lots of raised floor busted colo for the market.

3a. For landlords and property owners: What's your assessment of the current market for leasing of data center space? What trends are you seeing in demand for space and lease rates?

The market is still slow and plodding. After all of the post-9/11 moves are completed in metro NYC, it should slow even more. Major financial institutions while still functioning on bandaids are not interested in spending money on IT unless they absolutely have to. The SEC has as mentioned above added even more confusion.

4. Give us your outlook for 2004. What are the key trends you see affecting the industry?

When will the big guys at IBM, HP, EDS start really picking up steam for outsourcing? When will this drive demand for "mission critical data center" space like those owned for MetroNexus? It should be happening, but it's very hard to predict, since the outsourcing can also mean re-tooling existing corporate facilities.