CoreSite Buys Reston Campus, Eyes Big Expansion
- Aug 15, 2016
CoreSite Realty Corp. is expanding its footprint in Reston, Va., with the $60 million purchase of Sunrise Technology Park, a 22-acre light-industrial/flex office park near another CoreSite campus, the Denver-based data center owner/operator said Thursday. The deal paves the way for a potential a $400 million to $500 million redevelopment. Closing is expected in the fourth quarter.
Sunrise Technology Park was completed in 1985 and is described by the seller, Brookfield Office Properties, as consisting of four single-story office and R&D buildings, with typical floor plates of 63,000 square feet. The location is about a third of a mile from CoreSite’s existing campus in Reston and five minutes from Dulles International Airport.
The facility’s four buildings total 315,000 square feet, and based on its expectations regarding entitlements, CoreSite estimates that it could build more than 660,000 square feet of new data center capacity on the site.
Plans for the $90 million first phase call for redeveloping an existing 48,000-square-foot industrial building into a data center, building a ground-up 92,000-square-foot data center shell and building a 92,000-square-foot structure to house centralized infrastructure (including generators and cooling equipment) intended to support the full buildout.
Phase 1 is expected to be under way by the third quarter of 2017 and substantially complete in the second quarter of 2018.
The four existing buildings are currently 78 percent occupied, but no leases will be terminated, because the phased buildout will start with the unoccupied buildings, a CoreSite spokesperson told Commercial Property Executive.
CoreSite’s redevelopment plan for Sunrise Technology Park complements its existing colocation data center campus in Reston, which includes two facilities totaling more than 390,000 square feet of turn-key space. At full buildout, the 660,000 square feet of new capacity at Sunrise Technology Park would increase CoreSite’s capacity in Reston to more than 1 million square feet, or 2.7 times its current size.
“[W]e believe that the planned acquisition of the STP site will provide opportunities for CoreSite to continue its successful history of providing build-to-suit and wholesale data center solutions for customers with larger requirements,” CoreSite President & CEO Tom Ray said in a statement. The company noted that Northern Virginia is the world’s largest data center market.
CoreSite operates 17 data centers comprising more than 2.8 million square feet of data center space and has two more under construction.