Virginia's Loudoun County powers the data center market

A combination of bandwidth and connectivity have drawn data services and cloud providers to the Loudoun County in Northern Virginia county, making it home to 70 percent of the world's internet traffic.

NOTE: This story first appeared on GCN.com.

With 70 percent of the world’s internet traffic passing through the 10 million square feet of data centers situated in Loudoun County, it’s tempting to say that they put the Northern Virginia district on the map. But Buddy Rizer, executive director of the county’s Economic Development Department, might give AOL credit for that.

“It goes back to the late ’90s when AOL moved its corporate headquarters here,” Rizer said. “That was followed by [MCI-WorldCom]. What happened was everybody started running their fiber out to AOL, because in those days AOL was the internet and the internet was AOL for most people.”

Internet providers ultimately built an exchange point there known as MAE-East -- one of four U.S. Network Access Points as designated by the National Science Foundation.

“Those traffic centers were becoming more and more congested, and they were actually owned by carriers, so there were questions about how partial they were in terms of allowing traffic to continue to grow and expand,” said Jon Lin, vice president of corporate development and strategy for the Americas at Equinix, a global data center provider that opened its first location in Loudoun in 1998 to be a neutral steward of the infrastructure aggregation points.

From there, data center growth happened organically until about 10 years ago, when the county began proactively working to attract them, Rizer said. In 2014, Loudoun’s Board of Supervisors approved the Data Center Zoning Ordinance, which added data centers as a permitted use to districts zoned as commercial light industry or planned development of an office park, research and development park, industrial park or general industry.

The county also began offering the Fast-Track Commercial Incentive Program, which speeds the time to market for data center operators by providing a dedicated project manager from the department and moving the project to the top of development review lists. It also offers sales and use tax exemptions to data centers that invest at least $150 million, hire at least 50 employees, pay at least 1.5 times the average local wage and enter into a memorandum of understanding with the Virginia Economic Development Partnership.

“The tax incentives are nice, but overall they’re just part of the package,” Lin said. “Once all the connectivity was there, all the content providers seemed to be there and now all the cloud service providers are again using all of that bandwidth and connectivity. That’s really how Loudoun became the data center hub for the U.S.”

Equinix has more than 200 centers worldwide, about 11 of them in Loudoun. When it’s looking to expand, Lin considers factors such as proximity to population centers, bandwidth, fiber routes and subsea cable landing spots -- requirements Loudoun easily fills. And although the county has the largest concentration of data centers in the world, Lin isn’t worried about manmade or natural disasters affecting the area. 

“From an overall geographical risk perspective, Loudoun County is also quite nice. It’s got low seismic risk; it’s pretty far away from the water [with] no real flood risk,” he said. “Our customers are expecting us to be in locations that help them solve their application latency issues and performance challenges on the applications side so that they’re getting the best end-user performance.”

For the county, the data center industry has helped grow the population from about 80,000 in those early AOL days to 400,000 now. It’s also created a job boom; the county added 10,000 jobs – mostly in tech – in the past three years, Rizer said.

But taxes benefits are the biggest reward the 520-square-mile county reaps from what Rizer dubs its “cottage industry.”

“We’ll get about a quarter of a billion dollars in local tax revenue this year alone from the data center industry,” he said. “Data centers are a really high return on investment for us. For every $1 we spend on services for data centers, we get $9.50 back.”

By comparison, it costs the county more to provide services to single-family homes than it gets back, and for every $1 it spends on commercial businesses, it gets about $1.56 back. With an estimated median household income of $134,464 in 2016, according to the U.S. Census Bureau, Loudoun is the wealthiest county in the country.

And it’s not done growing. Loudoun has another approximately 5 million square feet of data centers in planning or under development. In February, Amazon Web Services submitted a plan to build a 600,000-square-foot data center on 44 acres near Dulles International Airport.

With data centers consuming about 100 billion kilowatt-hours of electricity -- 2 percent of all U.S. electricity use  in 2013, according to the Energy Department -- the county has been careful to work with local utility company Dominion Energy to keep power flowing.

“We don’t see that as a limiting factor at all going forward,” Rizer said. “Land would probably be our biggest limiting factor. We expect that we’ll have organic growth through the early 2020s, but at that point, we’ll probably be out of data center land.”

As a result, his department is looking to attract other businesses – especially those that can take advantage of the tech-savvy workforce and infrastructure in place.

“Just like a business doesn’t want to be too dependent on one product line, we want a diverse economy here,” Rizer said.

Other data center hubs include London, Europe’s largest; Singapore, which is Asia Pacific’s data center capital; and Beijing, according to an August Data Center Dynamics report. It adds that determining factors include climate, local economy, proximity to consumers, availability of power and networking connections, and politics.

“I think the thing that we did better than anybody else is we worked to understand data centers and worked to create an environment where they could come and thrive,” Rizer said. “All we did was enable. We set up the table for success and the companies reacted to that…. It has worked out incredibly well for us.”

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.