Brightlio Blog

In the rapidly evolving digital world, selecting a location for your company’s data center is an important decision. With robust network infrastructure, an advantageous location, and affordable power, Minneapolis colocation services present an appealing choice. This article delves into the city’s unique advantages, underscoring why Minneapolis, MN, has become a top destination for colocation services.

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Minneapolis Has a Growing Data Center Market

Minneapolis’s data center market continues to grow. Cushman & Wakefield ranked the region 4th on its 2024 list of emerging data center markets. At the end of 2023, there were almost 60 Megawatts of data center power capacity, with another 15 Megawatts under construction. The city is increasingly seen as an alternative to Chicago.

The region has over 34 data centers, and growing. Meta announced a $700 million data center investment in late 2023. LightEdge, a leading provider of colocation and cloud services, announced the purchase of a 3.6 Megawatt facility in nearby Chaska, Minnesota in early 2024. Finally, both Microsoft and Google have recently purchased land for data center development in Minnesota.

Minneapolis Offers a Thriving Economic Backdrop

Minneapolis, often paired with its twin city, St. Paul, forms one of the largest and most diverse economies in the United States. This vibrant region is home to a broad range of industries, including healthcare, finance, manufacturing, and technology. The Twin Cities area is home to 16 Fortune 500 companies, such as UnitedHealth Group, 3M, Target, and US Bancorp. This concentration of large corporations creates a high demand for IT services providing a fertile market for colocation.

Moreover, Minneapolis boasts a robust startup scene, particularly in the technology and healthcare sectors. Minneapolis / Saint Paul is home to more than 136,000 tech jobs. This is twice as many as Columbus or Charlotte and 60% more than Austin.

Additionally, the State of Minnesota has a robust and diverse economy. Minnesota’s GDP of $429 billion ranks 20th among US states. It’s one of the largest food producers in the country, with robust agriculture and food processing sectors. The state also has significant manufacturing, healthcare, and technology industries. 

The University of Minnesota and Mayo Clinic, both world-renowned institutions, further enrich the economic landscape with their research and innovation. This economic diversity ensures a stable environment for businesses, as the varied industries can help to insulate the state’s economy from sector-specific downturns.

Minneapolis Colocation Facilities Enjoy Affordable and Reliable Power

Minneapolis’s robust power grid and access to renewable energy sources provide reliable and affordable energy. These sources offer a degree of insulation against fossil fuel price volatility, which can be a significant advantage in planning and running a data center. The average cost of electricity in the state is 16 ¢/kilowatt-hour (kWh), which is 12% lower than the national average. As electricity costs are one of a colocation provider’s most significant expenses, lower electricity rates lead to lower prices for data center customers.

Minnesota is a national leader in renewable energy production, especially wind power. 28% of the state’s energy comes from renewable sources, and 81% of all new electricity generation capacity added in the last decade has been renewable. The state plans to obtain all its energy from clean sources by 2050. The presence of renewable energy sources provides an option for businesses concerned about their environmental footprint and those seeking to fulfill corporate sustainability goals.

Minneapolis Occupies Strategic Geographical Location With a Low Risk of Natural Disasters

Minneapolis’s central location in North America makes it a highly strategic location. Businesses can serve both the Eastern and Western United States, as well as major markets in Canada, from a colocation data center in Minneapolis. The city is also an excellent disaster recovery location for cities including Indianapolis, Toronto, St. Louis, and Denver.

In addition to its strategic location, Minneapolis also benefits from a relatively low risk of major natural disasters. Unlike regions prone to hurricanes, earthquakes, tsunamis, or frequent severe storms, Minneapolis experiences fewer disruptive events. The Twin Cities was ranked as the seventh safest metropolitan area in the United States based on the frequency of natural disasters. This stability is a significant advantage for colocation services, as it reduces the risk of downtime.

Minneapolis Offers Robust Telecommunications Infrastructure

Minneapolis is known for its robust telecommunications infrastructure. The region’s central location and diverse technology economy drive continual internet service expansion. 

Service providers like US Internet have been expanding their fiber-optic network across the city, offering exceptional connectivity with speeds up to 10 Gbps. Other providers, including Lumen Technologies and Comcast, offer fiber internet services in Minneapolis. Minneapolis also has an Internet Exchange Point (IXP), the Midwest Internet Cooperative Exchange (MICE). Colocation facilities linked to an IXP like MICE can provide businesses with faster and more reliable internet connections with speeds up to 100 Gbps.

Great Plains Communications announced in June 2023 the expansion of their 400 Gig high-capacity fiber network from Omaha to Minneapolis and Chicago. It also connects clients to Denver and Kansas City over the Great Plains network. This additional internet capacity enhances the region’s attractiveness as a disaster recovery site and its ability to court hyperscalers.

Major public cloud providers have invested in Minneapolis, as well. Amazon Web Services, Google Cloud, and Microsoft Azure all have availability zones in the city. The availability zones provide Minneapolis data center customers with low-latency access to the three largest public cloud offerings. 

Minnesota Data Centers Are Entitled to Tax Breaks

Data centers in the region can tap into a wealth of economic tax breaks that support business expansion and growth. In Minnesota, colocation facilities can receive up to 20 years of tax exemption on several operational duties, including computer and server purchases, software maintenance, cooling and energy equipment purchase, and data center energy consumption. 

Furthermore, Minnesota does not charge additional taxes on personal property, intangible property, inventory, utilities, information services, and internet usage associated with data center activity. These tax incentives make Minnesota a more attractive and cost-effective location for data center services.

Minnesota Boasts a Talented Workforce

Minnesota is renowned for its highly educated and skilled workforce, which offers a wealth of talent for businesses, including those in the technology and data management sectors. The high-tech sector accounted for 12.4% of Minnesota’s non-farm employment in 2019, the 13th highest share in the US. It ranks as the second most educated state in the nation, with a literacy rate of 94%. 

The region has many universities including the University of Minnesota, Bethel University, and the University of St. Thomas. These schools offer IT and engineering programs that build a skilled technology workforce. Annually, these schools produce a steady stream of tech professionals that can readily support data centers and their customers within the state.

Apart from fresh graduates, Minneapolis also boasts many experienced professionals. With many large corporations and tech startups in the area, there’s a wealth of skilled talent to tap into. This can be particularly beneficial for colocation services that require experienced professionals to manage complex data systems.

Leading Minneapolis Data Center Providers

There are 23 data center providers in Minnesota. Many of the data centers in the state are in the Twin Cities. Here are a few that Brightlio recommends considering:

Cologix

Cologix operates four Minneapolis data centers (MIN1 – MIN4) in downtown Minneapolis at 511 11th Ave South. These combine to total 45,000 square feet of data center space in the most connected building in Minnesota.

Why we recommend these data centers:

• Availability zones with major public clouds. Microsoft Azure is in Cologix MIN1 and AWS and Google are in MIN3.
• MIN1 is also home to the Midwest Internet Cooperative Exchange (MICE), providing outstanding peering options.
• A robust carrier ecosystem with 75+ carriers and ISPs are available in the meet me room.
• Cologix has 40 data center locations to choose from across the United States and Canada, making them an excellent partner for a broader colocation strategy.

Flexential

Flexential’s data center in the region is located in nearby Chaska, MN, at 3500 Lyman Blvd. It offers 160,000 square feet of data center footprint, 1500+ Watts of power per square foot, and a 9 MW critical load UPS capacity. It also provides access to Flexential’s 100 Gbps network backbone with redundant paths to every Flexential site.

Why we recommend this site:

• It is certified for many compliance standards, including HITRUST CSF, PCI DSS, SOC 2 Type II, SOC 3, ITAR, and more.
• It offers a newer generation 4 data center design.
• Flexential combines service capabilities, including connectivity, cloud servers, managed services, and business continuity, for a complete technology solution.
• Flexential offers data centers in 19 markets, including Dallas, Atlanta, Salt Lake City, Denver, Portland, and Nashville, making them an excellent partner for a national colocation strategy.

H5 Data Centers

H5’s data center facility is located between Minneapolis and Saint Paul at 1125 Energy Park Drive. The site offers 42,000 square feet of data center capacity and access to carriers, including Lumen, AT&T, Comcast, and Verizon.

Why we recommend this site:

• Convenient location for Minneapolis or Saint Paul-based businesses.
• Cloud on-ramps to AWS, Azure, and Google.
• Compliance certifications include PCI-DSS, ISO 27001, and SOC 2, Type II.

Brightlio is Your Key to Minneapolis Data Center Services

Are you interested in data center services in Minneapolis, MN? Brightlio can help! We provide competitive colocation solutions for Minneapolis / Saint Paul and other global data center markets. As your trusted telecommunication broker, we partner with a network of global data center providers to provide custom colocation services that match your needs and budget.

We also provide a suite of additional technology services, including network connectivity, SD-WAN, unified communications, public cloud solutions, and advisory services. We are committed to being your most trusted and responsive IT solutions provider.

Contact Brightlio today to get started!