Amazon leases data center space while Google and Microsoft build

DataCenterKnowledge reports on leasing 125,000 sq ft of office/warehouse space and converting it to data center space.

Report: Amazon Leases Space in Virginia

September 28th, 2010 : Rich Miller

Amazon’s expanding cloud computing operation apparently needs room to grow. The commercial real estate news site Globe Street reports that Amazon has leased a building in northern Virginia that will be used to expand its data center operations.

Citing an unnamed source, Globe Street says Amazon has leased a 125,000 square foot facility in Sterling, Va. and will invest $60 million in converting the site into a data center. The building, which is owned by a joint venture between Altus Realty Partners and Perseus Realty Partners, features a 90,000 square foot warehouse with 18-foot ceiling clearance that can be converted to data center space. The facility also features about 35,000 square feet of space currently used for offices.

as referenced the Globe Street mentions the shortage of space.

As data center space becomes ever more scarce in the area, a growing number of firms are investing in building out the operations themselves. Microsoft, for example, is investing $499 million in the southern county of Mecklenburg to build a data center. It will be the largest investment here and create 50 jobs, according to Virginia Gov. Bob McDonnell.

Amazon has an estimated 150,000 plus servers which would have most companies building data centers not leasing them.  Amazon is a different breed than other high tech companies thinking like a retailer and driven by a financial discipline.  Amazon has only one built data center in Boardman, Oregon.

Will Amazon eventually build big data centers like the rest following Google, Microsoft, Yahoo, and Facebook? 

At many companies the rigors of getting approval a data center construction project approved are from the business units, technical people, and the CFO.  I would expect at, everyone wants to see the numbers, and they spend much more time on financial modeling.

Should we lease or build?

What is the best use of Amazon's capital and cash?

What is the overall operating expense of a leased vs. owned facility?

Latest decision in the East Coast. Lease.