Dec. 4, 2001 -- Data centers are out. Data fortresses are in.
That's the philosophy at DataCentersNow, which earlier this month announced that it had changed its name to the Fortress Development Company, hoping to capitalize on a renewed focus on ultra-secure facilities.
The Rockville, Md. company, a subsidiary of BeCo Development, has pursued one of the bolder strategies in the data center sector, building three large "cyberfortress" facilities on speculation.
Even as its tries to fill the vacant space it has already built, Fortress is preparing to develop the CyberPlex@Dulles, a 3 million square foot mixed-use project combining data center space and highly-secure office buildings.
In an industry littered with casualties of overexpansion, Fortress believes its focus on speculative but specialized mission-critical space is about to pay off - particularly in Northern Virginia.
"The federal government, with its emergency spending, is going to be very active in this market," said Jason Britton, Director of Marketing for Fortress Development. "I look for a mass migration of government agencies out of Washington. These offices for government agencies are going to be spread out."
With its emphasis on ultra-secure facilities in the suburbs, Fortress stands to benefit from that trend, which is driven by the terrorist attacks on Sept. 11.
"It's bittersweet," said Britton. "You never want to see anything like what happened Sept. 11. It's forced us as a country and government to reassess what we thought was secure. We're seeing a push away from the downtown."
The name change is part of the company's effort to differentiate its facilities in a crowded market for mission-critical buildings.
“While the name ‘DataCentersNow’ described an important aspect of our business, it didn't convey that our CyberFortress facilities secure more than data,” said Chris Epstein, president of Fortress Development. “Employees of corporations and government agencies are increasingly called upon to conduct a full spectrum of mission critical activities.”
"We have a specific market, and that market is alive and well," said Britton.
One might not guess that based on the occupancy of the three projects the company has completed. A pair of 110,000 square foot CyberFortress buildings in Chicago and Prince William County, Va. have yet to be leased after being completed earlier this year. A large telecom company signed a letter of intent for the Virginia site, but has since changed its mind.
It was a very different story when the company's CyberFortress I was completed in the spring of 2000. Nearly 60 prospective tenants toured the Loudon County site, and 11 bidders competed for the right to lease the project, according to Britton.
The winner was Infocrossing, a Leonia, N.J. managed services provider. But in August Infocrossing halted work on CyberFortress I, citing an overabundance of hosting space. It is now actively marketing the vacant space.
Britton acknowledges that the current glut of finished data centers "definitely alters the equation."
"My biggest responsibility becomes education," said Britton. "We have to explain the difference between a colocation and hosting data center and what we do."
One difference is location. By opting to build outside the central business districts of major cities, Fortress had the space and flexibility to incorporate "mega-security" features such as bulletproof glass, extra-thick cement walls, and deep setbacks from nearby roadways.
In the wake of the Sept. 11 attacks, corporations and government agencies are revisiting the security of their employees as well as their data. That's one area where Britton feels Fortress is well-positioned.
Its sites are built to meet the Sensitive Compartmented Information Facility (SCIF) code, a National Security Agency standard for buildings that handle sensitive government data or intelligence. SCIF mandates a sturdy infrastructure and tight controls on building access.
In August Fortress Development spent $23 million to purchase 425 acres for the CyberPlex@Dulles development, which Britton says will be "designed for people rather than servers." Plans call for a gradual buildout that could eventually include 860,000 square feet of data center space and 2.5 million square feet of secure office space.
In coordination with Dominion Virginia Power, the site also boasts a planned 250 megawatt electric substation. The total project cost of development is expected to exceed $500 million.
"CyberPlex@Dulles will set a new standard for the way that office parks are designed in the future," said Epstein. "The concept of combining fortified and securable data center and office buildings in a unified complex is a novel idea that we feel will answer the increasing need to keep mission-critical operations separate and highly secure, yet accessible."
The timing of the buildout will depend upon how long it takes the company to lease its existing CyberFortresses, according to Britton.
"The focus on 'now' and speed to market is no longer a driving issue," said Britton, who says a surge in demand for such highly-secure space is inevitable.
"Every company in the last 60 days has had that discussion (about disaster recovery)," he said. "A lot of companies right now don't know what to do. But the days of companies storing their data in basements and closets are over."