Mahwah’s NYSE Center Part of Growing Data Trend, NY Times Reports

The unmarked building on Macarthur Boulevard in Mahwah that houses the New York Stock Exchange’s backup data was one of the examples the New York Times used Tuesday in an article on the increasing real estate value of data centers in Northern New Jersey.

Despite their addresses outside Manhattan, data centers throughout the region are commanding big bucks for companies to rent out remote computer back-up, and big amounts of energy, the report said.

“Why pay $600 or more a square foot at unglamorous addresses like Weehawken, Secaucus and Mahwah?” the article asks. “The answer is still location, location, location — but of a very different sort.”

It goes on to explain that “companies are paying top dollar to lease space there in buildings called data centers, the anonymous warrens where more and more of the world’s commerce is transacted, all of which has added up to a tremendous boon for the business of data centers themselves. The centers provide huge banks of remote computer storage, and the enormous amounts of electrical power and ultrafast fiber optic links that they demand.”

The growing industry, the article says, is blurring the lines between the real estate industry and utility companies, as the centers’ main attraction is its access to a tremendous amount of power.

Many of the companies that own the northern NJ data centers are petitioning the IRS to gain real estate investment trust status, exempting themselves from many corporate taxes, the report said. The companies have also, thus far, avoided the scrutiny of utility regulators, which set prices for the distribution of power, it said.

Meanwhile, the stock prices for most of these companies are on the rise, and some are pulling in hundreds of millions of dollars in profits, NYTimes.com reported. As the demand for data centers is on the rise, the regulations governing the industry is still developing, the report said. Read the full NYTimes.com analysis here.

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