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Phoenix colocation

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    Phoenix Data Centers: Colocation in the Valley of the Sun

    Phoenix, Arizona, could be the perfect city for you if you are in the market for retail colocation services. With over 90 data centers and 30 multi-tenant data center providers existing, Phoenix, combined with surrounding areas like Chandler, Mesa, Goodyear, and Glendale, ranked as the third largest data center market in North America in Cushman & Wakefield’s 2024 report. Phoenix presents many advantages for companies looking for a favorable colocation environment.

    If you are exploring other tier-1 data locations like Dallas, Los Angeles, or Silicon Valley, you should consider Phoenix. This article delves into the most important reasons to consider the Phoenix data center market for your next colocation facility. Let’s get started.

    Phoenix data centers

    Phoenix Has Reliable Internet Infrastructure and Network Connectivity 

    Phoenix boasts three major carrier hotels (Digital Realty’s site at 120 East Van Buren Street, phoenixNAP’s site at 3402 East University Drive, and Iron Mountain’s location at 615 North 48th Street). The city is also part of the southern fiber route. This stretches from California through Texas, Atlanta, DC, and New York. Ubiquitous fiber connectivity options mean you can get low-latency links to major markets from Phoenix.

    The city’s robust fiber network provides high-speed connectivity from downtown Phoenix to the suburbs. With over 150,000 miles of fiber optic capacity, the Phoenix offers reliable internet connectivity with diverse network paths. This also provides low-latency links to western colocation hubs like Silicon Valley, Las Vegas, Dallas, Denver, Los Angeles, Salt Lake City, and San Diego.

    The Arizona Commerce Authority announced a strategic broadband plan to increase reliable internet connection within the state in February 2022. This plan aims to create a state-wide fiber network along I-17 and I-19 with a future expansion plan along interstate and highways, particularly Phoenix, Flagstaff, and Nogales.

    Public cloud providers are increasingly calling Phoenix home. Microsoft AzureGoogle Cloud, and Oracle, have availability zones on Phoenix. This allows customers colocating in Phoenix to connect to their preferred cloud with the lowest possible latency.

    Phoenix also has a wealth of fiber providers, MPLS, and broadband providers in the market. These include Intermountain Infrastructure Group (IIG), Alluvion Communications, Colt Technology Services, Arelion, AT&T, Cox Communications, Zayo, Crown Castle, Fatbeam, Hudson Fiber, InnerCity FiberNet (ICFN), and Cogent Communications.

    Phoenix Enjoys Affordable and Reliable Power Supply

    Power supply significantly contributes to retail colocation costs. The lower power costs available in Phoenix help customers drive down the cost of colocation services.

    Average power costs in Phoenix are around 14 ¢/kWh, which is 3% lower than other parts of Arizona and 34% lower than the national average. While power costs are higher than markets like Dallas, Phoenix makes up for this with the abundance of alternative energy. For example, Arizona ranks as the fifth leading state in generating solar energy within the US. The Salt River Project’s recently completed Sonoran Solar Energy Center delivers 260 Megawatts of power. It will mostly be used to power Google’s $600 million data center.

    Data centers in Arizona are less likely to suffer from power interruption. This is because the state has many green energy options that companies can harness as alternatives. Two major solar plants, Agua Caliente and Solana Generating Station produce over 600 megawatts of electricity combined. A combination of smaller utility- and small-scale solar installations produce over 4500 megawatts of solar-generated electricity.

    Power companies also rely on natural gas, biomass, and geothermal resources to build a reliable power system, allowing data centers to support their sustainability goals. The city has over 600 megawatts of multi-tenant commissioned power supply available to colocation facilities.

    Additionally, Arizona public service offers an extra high load factor rate of over 90% to colocation facilities that consume at least 5 megawatts of energy. This helps make the Phoenix power market competitive and affordable.

    Phoenix colocation data center

    Phoenix Offers Attractive Economic Development Laws for Businesses

    Arizona offers many favorable economic conditions that provide stability for the Phoenix. This helps explain why Phoenix has the third-most data center capacity under development of any US market, trailing only Northern Virginia and Atlanta. Let’s explore a few of the key drivers for growth.

    Tax Breaks

    Similar to data center hubs like Texas, Arizona provides a 10-year tax exemption on equipment acquisition and labor services for data centers within the state. The waiver also extends for 20 years when the business qualifies for a sustainable redevelopment project. 

    Additionally, if data centers contract with qualified state operators for a minimum of 500 kilowatts of power for two years or longer, they can qualify for tax reductions. These tax breaks allow Arizona data centers to provide competitive prices to customers interested in retail colocation.

    Reduced Real Estate Costs

    The real estate market in Arizona provides a lot of advantages when it comes to property costs. The desert and flat geography mean that there is plentiful land to be developed within an affordable price range. This affordability makes Phoenix an attractive location for colocation facilities.

    Compared to other competitive data center markets in the US, Phoenix has one of the lowest cost-per-acre price ranges after Dallas. Arizona also provides a depreciation policy that provides over 70% reduction in property tax in the first year. All these are contained in the Arizona competitiveness package signed in 2011.

    These reductions in property costs allow colocation facilities to provide favorable lease contracts to customers interested in retail colocation.

    Low Lease Rates for Retail Colocation 

    Compared to west coast markets like Los Angeles and Silicon Valley, Arizona provides a lower total cost of ownership (TCO) to corporations interested in doing business in the state. As a result, Data centers in Arizona can offer lower lease rates for retail colocation facilities compared to other tier-1 data center markets in the country.

    Phoenix Enjoys Favorable Weather Conditions

    Phoenix has a minimal record of damage as a result of severe natural disasters. Due to its geographic location, it is rated a low-risk area concerning floods, hurricanes, and seismic events. Beyond occasional heatwaves, Phoenix ranks very low regarding extreme weather conditions affecting other data center markets in the US.

    As a result, Phoenix has always been considered a great disaster recovery site and is now emerging as a primary market for the development of colocation facilities. These stable weather conditions lower upfront construction costs and keep attracting industry investors. 

    Phoenix Has a Thriving Technology Ecosystem

    Phoenix is home to a thriving ecosystem of tech companies. Home to several corporate and regional headquarters, the city has experienced a rise in the influx of tech companies and skilled labor that settle yearly. Avnet, one of the largest technology distributors globally, is headquartered in Phoenix. Other Fortune 500 companies based in Phoenix include Freeport-McMoRan, Republic Services, Magellan Health, and Sprouts Farmers Market.

    Phoenix Colocation Providers Brightlio Recommends

    If you are looking for a colocation provider in Phoenix, below are a few options we recommend. Contact Brightlio for Phoenix colocation pricing from these and other providers.


    Evocative’s Phoenix data center is located at 2500 W. Union Hills Drive. The Aligned Energy owned data center boasts 550,000 square feet of data center space and an N+2 power design.

    Why we like Evocative’s Phoenix data center:

    • Excellent power efficiency with a PUE of 1.15 and some of the most advanced cooling technology in the industry.
    • Evocative has a national data center footprint with locations including Los Angeles, Dallas, Atlanta, Northern Virgina, San Jose, Boston, and Seattle. This makes them a great partner for a national data center or disaster recovery strategy.
    • Evocative offers other services including bare metal servers and managed services.


    Centersquare’s Phoenix-area data center is located 1301 W University Drive in Mesa, AZ. It boasts over 73,000 square feet of raised floor data center space, and a 99.999% uptime SLA. Centersquare was called Evoque until a company rebranding in April 2024.

    Why we like Centersquare’s Phoenix data center:

    • Cloud connectivity via connectivity from Megaport.
    • Up to 300 Watts per square foot cage density, plus higher density racks available making the site perfect for AI, crypto, and cloud workloads.
    • Other data center locations including Irvine, Chicago, Nashville, and New Jersey, make them a great national colocation partner.


    Flexential’s Phoenix colocation facility is located at 1850 W Deer Valley Road in Phoenix. It offers 42,500 square feet of data center space and 5 MW of power.

    Why we like Flexential’s Phoenix data center:

    • Flexential offers a 100% SLA on power, cooling, bandwidth, and network.
    • It meets multiple compliance certifications including HIPAA, PCI, SOC 2, and NIST.
    • Cost effective options perfect for small businesses and startups.
    • 100 Gbps network backbone between Phoenix and other Flexential locations including Las Vegas, Denver, Minneapolis, Philadelphia, and Salt Lake City.


    As the name implies, PhoenixNAP focus on colocation services in Phoenix. They operate one of the city’s premier carrier hotels with over 40 on-network connectivity providers.

    Why we like PhoenixNAP:

    • An unrivaled commitment to the Phoenix market.
    • They offer numerous services at the Phoenix location including bare metal, cloud, backup, and data center as a service.
    • Direct connectivity to Amazon’s AWS.
    • Services at international locations including Amsterdam, Singapore, and Belgrade.
    Phoenix data center colocation

    Brightlio Delivers Phoenix Colocation!

    If you are in the market for colocation services in Phoenix or other markets, Brightlio can help.

    With our extensive network of global data center partners, Brightlio is committed to helping you select the right colocation partner for your data center needs and budget. Our team provides competitive colocation pricing for data centers in Arizona and other markets. As a telecommunication broker, there is no cost to you for our services.

    We also offer cloud, network connectivity, and unified communications services, allowing us to address many of your technology needs.

    We are committed to being your most trusted and most responsive technology solutions partner. Contact Brightlio today!

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