Adam Falkof Addresses Unique Nature of Data Center Real Estate Deals in Chicago Lawyer ArticleChicago Lawyer 04/21/22
Chicago – Adam Falkof, a member of the Quarles & Brady Real Estate Practice Group based in the firm’s Chicago office, talked about some of the factors that make data center real estate deals different from a typical commercial real estate deal in a Chicago Lawyer article about the topic.
He pointed out that for data centers, the energy-related costs of a site are more important than the traditional cost-per-square-foot criteria. An excerpt from the article:
“Square footage doesn’t matter in data centers,” said Adam Falkof, a partner at Quarles & Brady. “When you talk to someone who’s not used to data centers ... (they wonder) what’s typical cost per square foot. That’s exactly what you’d expect to hear in an office, retail, or an industrial lease. Everything is measured in kilowatts. The first thing when you’re pricing (a data center) it’s a price-per-kilowatt and everything relates to power.”
Falkof is already thinking ahead to the growing climate crisis and how power for data centers will factor into this issue. He’s worried that if hydro power becomes too costly or renewable energy sources don’t play a major role, dollar figures will rise. “They’re already expensive outright, but they’ll be even more expensive to operate,” he said.