Brightlio Blog

Located in America’s heartland, the Iowa data center market is emerging as a leader in digital transformation. Renowned for its renewable, affordable energy, Des Moines and the state of Iowa are fast becoming a pivotal hub for advanced colocation and connectivity, meeting the demands of our increasingly digital world.

Situated comfortably away from the nation’s natural disaster hotspots, Iowa combines security with financial appeal through its tax-friendly incentives. More than a data haven, it’s a strategic choice for companies aiming to secure and optimize their digital future. Let’s delve deeper and explore what makes Iowa a prime choice for your data center needs!

Iowa Offers Renewable and Affordable Energy

In 2021, 58% of Iowa’s electricity was wind-generated, ranking it the nation’s second-largest wind power producer. For data centers, this means a stable and sustainable energy source that aligns with environmentally responsible operations. With a history of wind development spanning over 25 years, Iowa’s commitment to renewable energy is both substantial and enduring.

Furthermore, affordability is a standout feature in Iowa’s energy landscape. The state’s residents enjoy electricity bills 29% lower than the national average, with just 14 ¢/kWh rates. This equates to significant operational savings for data centers—a crucial factor when power consumption is a significant operating cost.

Moreover, new wind projects are propelling Iowa beyond its current 12,219 MW of wind energy, with projections to exceed 14,000 MW by 2024, according to the Iowa Environmental Council. This growth is punctuated by major investments, such as the $3.9 billion infusion from a subsidiary of Berkshire Hathaway Energy. 

These projects, including MidAmerican Energy’s Wind PRIME initiative, establish Iowa’s commitment to increasing capacity and diversifying into renewables like solar and other cutting-edge energy technologies.

For colocation facilities, Iowa is a long-term partner in sustainability, aligning digital infrastructure with renewable energy.

Iowa Enjoys Robust Network Infrastructure and Connectivity

In the vibrant capital of Des Moines alone boasts six data centers. These are part of a larger network of 15 across seven data markets located in the state. This robust capacity indicates Iowa’s readiness to support large-scale, demanding data operations, capturing major tech companies’ attention globally.

Leading the charge is Microsoft, with three expansive projects in West Des Moines. With a total investment exceeding $2 billion across two data centers and bolstered by $41 million in state-provided incentives, Microsoft’s commitment underscores the region’s appeal as a prime location for data infrastructure.

And it’s not just Microsoft that sees the potential here. Other tech giants like Meta, Apple, and Google have invested significantly in Iowa, indicating widespread confidence in the state’s robust and reliable network infrastructure.

The state is also a focal point for building and expanding high-capacity telecommunications networks in the Midwest. For instance, Bluebird Network’s recent 11.74-mile fiber route expansion in Waterloo. This extends towards Chicago, and signifies Iowa’s role as an increasingly interconnected digital hub.

Amidst this burgeoning digital landscape, the Aureon Network stands out. With over 5,000 miles of fiber routes, it offers a remarkable 10-gigabit capacity and direct connectivity to multiple Tier 1 providers. It employs advanced technologies like Dense Wave Division Multiplexing (DWDM) to ensure cost-efficient, scalable, and secure operations. 

Further complementing these corporate investments and cutting-edge infrastructure are collaborative initiatives shaping a nurturing environment for data center operations in Iowa. One notable example is the Ripple Effect Program, a joint venture between Aureon and the Iowa Area Development Group (IADG). This program promotes business and community development, offering extensive support and growth opportunities across the state.

Iowa Provides a Safe Haven from Natural Disasters

Iowa offers geographical stability, free from coastal hurricanes and even the low seismic risks of Western states like California, Oregon, Washington, and Colorado. Furthermore, the state is insulated from extreme weather events that can threaten critical data infrastructure. 

While Iowa experiences blizzards and storms, these typically pose manageable power outage risks. This makes the state an appealing and secure choice for safeguarding essential data operations.

In addition to its natural resiliency, Iowa offers economic advantages with its low land and utility costs. As such, this readily translates to savings and peace of mind for data center operators and carrier hotels. In Iowa, safety and affordability are seamlessly intertwined. This allows businesses to operate in a low-risk environment without the burden of inflated costs tied to disaster-prone locations.

Iowa Data Centers Benefit from Tax-Friendly Policies

Since initiating the Large Data Center Business Exemption Policy in 2009, Iowa has positioned itself as an increasingly attractive location for data center investments, including retail colocation services. As the capital city, Des Moines is a prime example of how these strategic tax incentives foster data center development across the state. Google recently announced a $600 million investment in Council Bluffs, driven partly by a $16.6 million local property tax break.

In Iowa, data centers that invest at least $200 million within the first six years qualify for significant sales and use tax exemptions on essential purchases and operations. This starkly contrasts with states like New York, where data center operators face substantial property taxes on equipment and do not enjoy such broad tax incentives.

The tax-friendly environment in Iowa not only lowers the initial cost of investment but also provides a lasting competitive advantage. For instance, Iowa’s legislation allows for no property tax on equipment or computers in data centers and no corporate income tax on profits from sales made outside of the state. This unique combination of incentives significantly boosts the cost savings for data centers, thereby encouraging continued growth and investment in Iowa’s technology sector. 

Furthermore, Iowa’s economic stability and growth are exemplified by its representation on the Fortune 500 with two companies—Principal Financial and Casey’s General Stores. These thriving companies and the state’s favorable tax policies make Iowa a vibrant and diverse economic hub.

Iowa Has Continuous Access to Tech Talent and Skilled Labor

Iowa sets a national educational standard with a 94.3% high school graduation rate. The state is home to renowned educational institutions. These include The University of Iowa and Drake University. Along with 15 community colleges, they prepare the workforce for sectors like data center operations.

The University of Iowa notably hosts enterprise data centers that are vital to the institution’s membership. These data centers not only support critical production services but also offer advanced server colocation spaces and comprehensive support services to campus departments and researchers.

Iowa’s proactive approach to workforce development, particularly in STEM fields, is a defining feature. The state effectively bridges America’s skills gap, with community colleges playing a pivotal role as collaborative partners with businesses to develop essential skill sets.

As of July 2023, Iowa’s labor market stands strong, with a low unemployment rate of 2.7% and a labor force participation rate of 68.8%. With a labor force of over 1.7 million, Iowa is steadfast in cultivating a sizable, educated, and industry-aligned workforce, making it an exceptional locale for data center investments.

Leading Iowa Data Center Options

If Iowa colocation pricing is what you’re after, consider these providers that we suggest to our clients:

LightEdge

LightEdge has two modern facilities at 1435 and 1401 Northridge Circle in Altoona, IA. These facilities offer a total of 48,000 square feet of secure and reliable colocation services. Safe from natural disasters and just 25 minutes from Des Moines International Airport, they offer a strategically situated and cost-effective solution for your infrastructure needs.

Why we like LightEdge Data Centers:

• Built to tier 3 compliance standards, ensuring advanced power and cooling technology.

• Features five stringent security levels, with 24/7 manned operations and biometric access.

• Secure cloud and hosting solutions

• Demonstrates a strong commitment to environmental sustainability.

• Provides 24/7/365 remote hands technical support and managed services by highly trained, industry-certified techs.

• Guarantees 100% uptime and availability, safeguarding critical systems.

• Operates 10 data centers nationally, expanding its footprint beyond Iowa to Austin, Omaha, Kansas City, Raleigh, San Diego, and Phoenix.

InfoBunker

Located within an hour of Des Moines, InfoBunker’s 65,000 sq. ft. Iowa colocation facility is a military-grade data center situated 50 ft. underground in a former Government Command Bunker facility.

Designed for 100% self-sufficiency under extreme conditions, it offers clients in various industries—healthcare to government—reliable and secure data solutions. The facility is SAS 70, HIPAA, and PCI DSS compliant with a 100% uptime guarantee.

Why we like InfoBunker:

• InfoBunker provides direct access to multiple network providers through 192 fiber strands, supporting IPv4 and IPv6.

• The facility has a grid and independent generators with a six-day fuel reserve and offers 150W per square foot of power availability.

• InfoBunker offers diverse colocation options, from single ‘U’ spaces to large private suites and per-use disaster recovery services.

• Their facility has EMP shielding to military standards, designed to survive a 20-megaton nuclear blast from 2.5 miles.

OneNeck 

The OneNeck IT Solutions data center site, located at 390 NE Alices Road in Des Moines, Iowa, features a substantial footprint of 20,000 square feet. It has a capacity of 6 MW to service up to 1000 cabinets. Furthermore, this facility is designed for optimal environmental controls through its advanced N+1 water-cooled HVAC systems. 

As an award-winning provider, OneNeck IT Solutions has garnered notable industry accolades, including the title Nutanix Global and America’s Service Provider of the Year. Beyond its primary location in Des Moines, OneNeck extends its colocation services to key markets, with locations including Minneapolis and Phoenix.

Why we recommend these data centers:

• They are engineered to withstand F4 tornadoes, with 12-inch concrete and steel-reinforced walls for ultimate resilience.

• With power sourced from MidAmerican Energy, where 88.5% comes from clean, renewable sources, OneNeck shows a solid commitment to sustainability.

• They offer customizable colocation services that scale with business needs, from cabinet space to caged areas and complex solutions.

Brightlio Delivers Solutions for Colocation in Iowa

If you’re seeking colocation options in Iowa, Brightlio is your partner of choice. As a renowned telecommunications and colocation broker, we leverage our extensive network of data center partners to deliver colocation pricing in Iowa, carefully tailored to meet your requirements and budget. From single racks and cabinets to exclusive cages or suites, Brightlio connects you with providers that surpass your expectations.

In addition to colocation services, we specialize in cloud solutions, network connectivity, unified communications, and advisory services. With Brightlio, you receive an all-in-one technology solution designed to elevate your business to new heights. We are committed to becoming your most reliable and responsive partner in technology solutions. 

Ready to transform your enterprise’s tech strategy? Get started with Brightlio today!

If you enjoyed this article, check out our colocation guides for other states:

• California Data Centers: Brightlio’s Ultimate Guide to Colocation in the Golden State
• Data Centers in Connecticut: Six Reasons to Colocate in the Constitution State
• Data Centers in Florida: Colocation in the Sunshine State
• Data Centers in Massachusetts: Six Reasons to Colocate in the Bay State
• Data Centers in Maryland: Innovation in The Old Line State
• New Jersey Data Centers: Powering the Digital Future of the Garden State
• Data Centers in New York: The Gateway to Colocation in the Empire State
• Data Centers in Oregon: 5 Reasons to Colocate in the Pacific Northwest
• Data Centers in Texas: Colocation in the Lone Star State
• Data Centers in Northern Virginia: Brightlio’s Guide to Colocation in the Mid-Atlantic
• The Ohio Data Center Advantage