Iron Mountain Buys Frankfurt Data Center to Speed European Expansion

Iron Mountain will acquire a data center to accelerate its expansion in Frankfurt, one of Europe’s most strategic and competitive markets. Iron Mountain will pay EUR 76 million ($90 million US) to buy a 10-megawatt data center from Calcium DC, a unit of the Keppel Group.

The deal provides Iron Mountain with immediate capacity in Frankfurt, which is a hotbed of data center construction with most leading developers deploying new projects.  Last year Iron Mountain leased its entire FRA-1 project, a 27-megawatt, 280,000 square foot data center in Frankfurt.

“This latest investment in one of the most sought-after European markets further solidifies our commitment to invest in the global markets where our customers need us,”said Mark Kidd, Executive Vice President and General Manager of Data Centers at Iron Mountain. “As a leading global data center provider, we are pleased to continue to meet the key growth milestones that this acquisition, and the recently announced expansion in London, represent.”

The Keppel data center is a two-story, 20,000 square meter (215,000 square foot) building in the Am Martinszehnten Industrial Park, which is in close proximity to the city center and Frankfurt Airport. The facility currently has 2.6 megawatts of leased capacity and 8 megawatts of capacity available for colocation customers, with the option to expand in the future to add edge computing at the premises. The transaction is expected to close within the next 90 days.

New Capacity in a Hot Market

Frankfurt is a strong global data center market due to its position as one of Europe’s major commercial and financial hubs. It is one of the FLAP markets (Frankfurt, London, Amsterdam, Paris) that have been the focus of recent data center development in Europe, along with Dublin. Frankfurt offers rich connectivity to network fabrics and service providers, and the data center that Iron Mountain is acquiring has robust network access to DE-CIX, one of the world’s largest internet exchanges.

The new capacity will allow Iron Mountain to continue competing for deals in a market where key global players are all adding capacity, including Digital Realty, Equinix, CyrusOne, Vantage Data Centers and CloudHQ. As large tenants experience rapid growth, they are often seeking space on short timelines, and the availability of capacity can be a key decision point.

“We are thrilled to be adding an additional data center in Frankfurt to our global platform as it will meet the high demand we are seeing from our enterprise, edge and hyperscale customers in the Frankfurt market,” said Eric Boonstra, Vice President and General Manager, Europe at Iron Mountain Data Centers.

Iron Mountain recently announced further expansion in Europe with a 27 megawatt data center build in Slough outside London (LON-2), in addition to 9 megawatts of leasable capacity at its LON-1 data center.

Building and Buying

In recent years, Iron Mountain has been focused on building new data center campuses. But it was the leading player in data center M&A in 2017-18, when it rapidly expanded its footprint with a flurry of four deals:

• In July 2017, Iron Mountain announced the acquisition of FORTRUST for $128 million. The deal added a 210,000 square foot data center in Denver, 9 megawatts (MW) of existing data center capacity and expansion space for an additional 7 MW.
• In Oct. 2017, Iron Mountain agreed to buy two data centers from Credit Suisse through a sale-leaseback transaction in which the bank will stay on as an anchor tenant, and Iron Mountain will have the ability to lease the 10 MW of surplus space to other tenants.
• In Dec. 2017, the company said it will buy IO Data Centers for $1.3 billion, The deal includes data centers in Phoenix, Scottsdale, Edison, N.J. and Columbus, Ohio spanning 728,000 square feet of space and 62 megawatts (MW) of capacity. The IO footprint includes the potential to add another 77 megawatts of space in Phoenix and New Jersey.
• In May 2018, Iron Mountain acquired the EvoSwitch data center business for $235 million, gaining entry to the Amsterdam market, one of Europe’s major connectivity hubs.