The Contours of the Cloud: Dissecting the Real Estate Investment Decisions of Data Center Operators
Name
Fawcett-logan_f-msred-cre-2024-thesis.pdf
Description
Thesis PDF
Size
8.77 MB
Format
Adobe PDF
Checksum (MD5)
519c711229c14429230a19951189316e
Author(s)
Fawcett, Robert Logan
Advisor(s)
Scott, James Robert
Date Issued
September 2024
Publisher
Massachusetts Institute of Technology
Abstract
This thesis investigates the real estate investment decisions of data center operators, with a focus on how key infrastructure characteristics influence data center development. Using a sequential econometric approach, the research applies both a logit and a hedonic model to evaluate the importance of various factors. The logit model explores the likelihood of data center development at the county level, highlighting geographical characteristics. The hedonic model examines the impact of specific site attributes, such as proximity to power infrastructure and fiber, on the scale of data center facilities in megawatts. The findings suggest that colocation data centers prioritize connectivity, electrical infrastructure, and urban proximity, while the location of hyperscale facilities is more variable and less predictable. This study enhances our understanding of how modern technological demands, particularly in the AI era, shape real estate strategies and offers insights into future trends in digital infrastructure investments.
MIT Department
Massachusetts Institute of Technology. Center for Real Estate. Program in Real Estate Development.
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In Copyright - Educational Use Permitted
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