Article | Adaptive Spaces

The Nation Needs Fiber

Searches for Fiber-enabled Buildings Reveal a New Location Driver

5 Minute

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As the world’s corporate real estate leaders seek to future-proof their portfolios, where and whether to open a physical location remains one of the key decisions.

The workplace of tomorrow is going to look quite a bit different than today.

New smart environments will enable an increasingly connected workforce to collaborate with colleagues who work both remotely and on-site. Likewise, all the spaces we work, live and invest in will need to consider sophisticated technology solutions designed to support new health and wellness initiatives, as well as energy efficiency and sustainability measures. Network connectivity is at the heart of many of these upgrades, and this has already translated to a stronger need for a network that supports video and voice technologies.

The agile office of tomorrow will adapt some of its space planning toward an Activity-based Work (ABW) model. The new agile work models rely on technological innovations such as an increase in "bring-your-own-devices" (BYOD) and the integration of the IoT (internet of things) in commercial buildings, all of which add a commensurate emphasis on technology that requires proper fiber capabilities.

To help occupiers better plan their real estate footprint, CBRE’s Network Advisory Services partnered with FiberLocator to examine the top 100 most frequently searched commercial real estate locations across six major U.S. markets, including Boston, Chicago, Dallas/Ft. Worth, Denver, New York and San Francisco. These six cities are technology-centric markets that represent a diverse geographic landscape of commercial real estate. The study used data powered by FiberLocator’s fiber mapping database and market-leading knowledge to uncover trends surrounding building type, class and occupier sector.

Executive Summary

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Top 100 Fiber Searches by Market

Use this interactive map to view the top 100 fiber searches in six key markets: San Francisco, Denver, Dallas, Chicago, New York and Boston.

Office, with 47% of all searches, was the most-searched building type.

Fiber queries were predominantly for Class-A, multi-tenant office buildings. More than 50 industries were represented among office tenants, with finance/insurance and public institutions being the most prominent.

Office, data center and mixed-use buildings (often with data center tenants) made up 70% of fiber searches overall.

The remaining 30% spanned a variety of commercial real estate building types, illustrating the wide-reaching importance and value of network connectivity.

Figure 1: Searches by Commercial Property Type and Industry Sector

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Source: FiberLocator.

More than 30 locations across the markets analyzed are land or currently under construction.

This indicates the importance of considering fiber-based network construction and infrastructure early in the site-selection process.

Roughly 5% of locations in the study were multifamily.

Denver had the strongest representation of multifamily locations, primarily clustered around downtown Denver and Boulder. As the trend towards work-from-anywhere grows, end users are demanding seamless connectivity and access to more than one service provider.

Market Recap

Boston

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  • Boston had the strongest representation of life sciences facilities – an area of commercial real estate that has experienced heightened interest in 2020. The industry’s data-intensive environments go hand in hand with high bandwidth requirements.
  • Boston’s carrier hotel, One Summer Street, was the market’s most-searched building, searched more frequently than the next 19 buildings combined, and overall, the second mostsearched building measured in the study. The 920,000-square-foot facility is an important telecommunications hub and New England’s largest and longest-operating multitenant data center. The facility offers unsurpassed network interconnections for all service types and routes data traffic from essentially every national and most international fiber-based network service provider.
  • Nearly all of Boston’s top 100 most-searched buildings appear in the urban core and in East Cambridge within the close-in suburb’s North submarket. Searches in this market were generally concentrated around the high-tech, life science and research-laden commercial areas.
  • Boston had the largest percentage of retail searches in the study, most of which were in the Seaport District – a neighborhood that has historically lacked robust network infrastructure.

Chicago

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  • Chicago had the second-largest quantity of data center searches in the study behind Dallas/Ft. Worth. More than 42% of market searches were for data centers distributed across 19 facilities located mainly in the urban core and in the northwestern suburbs. Chicago is a highly favorable data center market and experienced inventory growth of more than 96% since 2015.
  • The Chicago market had the largest number of searches for healthcare buildings. Searches included three major hospitals as well as several multi-tenant office buildings occupied by various healthcare providers. As technology and the delivery of treatment evolves, high-speed fiber optic network will become even more critical for medical institutions in order to effectively communicate and securely store and transmit data.
  • Chicago had the second strongest representation of finance/insurance occupiers. The city houses five major financial exchanges and a highly competitive financial center which are supported by uniquely designed data centers and low-latency networks.

Dallas/Ft. Worth

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  • The Dallas/Ft. Worth (DFW) market was searched more frequently than any other market. DFW also claimed 4 of the top 10 most-searched buildings across the study, including the number one most-searched building, 1950 North Stemmons Freeway.
  • Overall, the #1 most-searched address in these markets was 1950 North Stemmons Freeway in Dallas, TX. This iconic, 1,583,309-square-foot building is one of the largest in Dallas and one of the most well-connected buildings in the world. More than 45 fiber-based providers have a physical presence in the facility, making it a key interconnection hub for data, voice and video traffic. Given its physical location, the building is the hub of connectivity in the South-Central region of the United States and acts as a gateway to Mexico and Latin America. Virtually every provider that services Mexico has a physical presence here or data traffic flowing through the building. The facility also enables direct connection to cloud onramps to major providers and access to peering options with more than 100 networks and content providers.
  • 25 of DFW’s top 100 most-searched buildings were data centers. This was the largest of any market in our study, which comes as no surprise given that DFW is the second-largest data center market in the U.S. behind Northern Virginia. Searches for data centers were centralized in the Dallas urban core and heavily clustered in the Richardson/Plano and Stemmons Freeway submarkets.
  • DFW had the strongest representation of industrial buildings across the study, with 19 industrial buildings making the top 100 list.

Denver

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  • The Denver market had the most multifamily projects searched across all six markets. Although the multifamily market softened in 2020, Denver’s compelling demand dynamics continue to attract investors and new residents with growing appetites for network bandwidth.
  • 64% of office searches were based in Downtown Denver, while the remaining office searches largely appeared in the Denver Tech Center within the Southeast submarket.
  • Denver’s carrier hotel located at 910 15th St, was the market’s most-searched building and was searched more frequently than the next six buildings combined. The historic data center building is strategically located in the heart of downtown and facilitates interconnections to all major carriers and internet backbones and exchanges.
  • Denver also had a strong representation of industrial buildings on the top 100 list, second only to Dallas/Ft. Worth.

New York City

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  • New York City’s top 100 was dominated by office with 59 office buildings appearing on the list. The office buildings represented were 63% Class-A, 27% Class-B and 10% Class-C.
  • Nearly all office buildings were multi-tenant, with occupiers representing a variety of industries. It is worth noting that New York City had a strong presence of flexible workspace tenants compared to other markets in the study. As companies reevaluate their office space needs, more fluid environments may become more appealing, provided that the space can meet the network demands of a coworking setting.
  • New York City had the largest percentage of mixed-use properties in the study which can be attributed to the city’s urban style living. Unlike the Dallas, Denver or Chicago markets, most of New York City’s data centers are housed within multi-tenant office buildings or mixed-use buildings. Examples of this include New York City’s two most-searched buildings, 60 Hudson and 111 8th Ave. Although the buildings might look like office skyscrapers from the outside, they are recognized as two of the most important interconnection facilities in the world and are responsible for connecting domestic and international telecommunication networks and internet backbones.

San Francisco

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  • San Francisco had the largest percentage of retail buildings in the study, primarily centralized near Union Square, a popular shopping district. As businesses adapt to the new normal, many retailers are looking to enhance customer safety and in-store experiences with technology-rich solutions that require adequate network infrastructure to function.
  • Hospitality accounted for 5% of San Francisco’s top 100, which was the largest percentage of any market.
  • San Francisco had the lowest quantity of total searches relative to the markets captured in the study. One explanation for this is that the study did not expand into neighboring Silicon Valley, which serves as the region’s data center and tech epicenter. The city’s strict zoning and permitting processes have also limited the implementation of new fiber builds and expansions of existing infrastructures.

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