Goodyear, Arizona is in the midst of a data center building boom and is drawing some of the biggest names in hyperscale computing, machine learning and artificial intelligence.
A submarket of Phoenix, Goodyear is home to hundreds of megawatts of potential data center capacity, and demand is growing. Enterprises, startups and government entities are choosing to deploy their digital infrastructure in Goodyear as a west coast alternative to the California market, which comes with higher costs and disaster risk.
Most recently, high density colocation provider DCX opened its first high-performance data center in Goodyear in October 2022. Led by industry veterans and trailblazers, George Slessman and Bill Slessman, DCX is designed to meet the demands of the most advanced applications, including ultra-high-density AI workloads. Once fully built-out, the six-acre campus will provide 12 megawatts of IT capacity across six private data suites. Each DCX data suite offers from 700 kW to 1 megawatt of capacity and features dedicated critical infrastructure, including UPS and generators, and waterless cooling systems.
What’s driving growth in Goodyear?
A variety of factors have contributed to growth in the Goodyear data center market, including a favorable business environment, affordable electricity and lower real estate costs.
Here are the top 5 reasons colocation and cloud customers are gravitating to Goodyear:
Reliable Internet Infrastructure and Rich Network Connectivity
Goodyear is located less than 20 miles from Phoenix, the third most fiber-connected U.S. market. This well-established infrastructure is key for mission-critical applications that require proximity to a robust fiber network. Customers have the ability to run applications closer to where compute is needed for low latency and high availability.
DCX, for example, offers advanced connectivity to multiple local fiber networks through its Goodyear 1 facility, which is particularly important for hyperscale and enterprise customers running ultra-high density AI workloads.
Affordable and reliable power supply
The Goodyear market is increasingly desirable for data center operators for its stable, low-cost power relative to proximate markets like Northern California and Los Angeles. Arizona public utilities generate power from a variety of stable sources and charge substantially less per kilowatt hour than other Western states, according to the U.S. Energy Information Association. Power cost is a critical decision point for both data center providers and users. The difference of a few cents per kilowatt can mean millions of dollars saved for data center deployments.
Not only is power cost-effective in Goodyear, but importantly, it’s clean, safe and reliable. Arizona’s power grid has access to renewable energy sources like solar and wind, which benefits customers looking to meet sustainability goals. In fact, the Arizona Public Service (APS) has one of the country’s most ambitious clean-energy goals and uses a balanced energy mix that is 50 percent carbon-free.
Some data centers, like DCX, leverage nearby substations to deliver ultra-high-density power. This means that customers can take advantage of maximum compute density without compromising on performance or reliability. Additionally, DCX’s water utilization efficiency is zero, making it an environmentally conscious choice for businesses looking to minimize their environmental impact.
Attractive Economic Development Laws for Businesses
The City of Goodyear is one of the top places for commercial real estate in Arizona, supported by municipal leadership, tax credits, and incentives that make large-scale developments like data centers especially effective.
A significant source of savings is the 20-year sales tax exemption under the Arizona Computer Data Center Program. Colocation customers are exempt from sales taxes on purchases of data center equipment—as well as install, repair, and maintenance—if they contract with a qualified data center provider like DCX.
Operators like DCX also save on property taxes and pass those savings onto their customers in the form of low lease rates on colocation. Factor in the significant power cost savings associated with power usage effectiveness (PUE), and the total savings can be significant for a typical deployment.
Very low risk of natural disasters
If you are exploring other tier-1 data center locations like Dallas, Los Angeles, or Silicon Valley, you should also consider Goodyear. The city presents many advantages for companies with mission-critical applications looking for a low-risk colocation environment. Notably, Goodyear is not prone to adverse weather or natural disasters, providing a reliable ecosystem for data centers. Unlike other major U.S. markets, hurricanes, tornadoes, floods, wildfires and earthquakes pose little to no threat to the region.
Thriving tech market
Colocation and cloud providers are in good company in Goodyear. Microsoft, Amazon Web Services, and a growing cluster of data center providers, including DCX, have invested significantly in the area over the past few years. Together, they have created a competitive market for data center users.
Goodyear also benefits from a talented workforce due to its proximity to Phoenix, and the highly educated population of the region. The City’s tech talent pool continues to grow as companies are drawn to Arizona’s business-friendly climate, its ever-growing millennial population, and relatively lower cost of operating than most major markets, according to a 2022 CBRE survey.
And while the data center real estate market has been hot, commercial land available for development still exists in Goodyear allowing for more room to grow.
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