What Does It Cost to Build a Data Centre?

A data center is a physical facility where businesses keep their vital applications and data. A data center’s architecture is built around a network of computing and storage devices that allow for standard applications and data sharing. Routers, switches, firewalls, storage systems, servers, and application-delivery controllers are critical core components in modern data centers.

Data Centre Cost

The cost of ownership in maintaining a private data center or co-location facility is Data Center Cost. The property, structure, servers, networking gear, power, cooling systems, and other network infrastructure needs.

While some factors influence annual expenses, the cost to build a data centre is determined by the building’s footprint, its site, and the center’s purpose.

On average, the cost of running extensive large data center services ranges between $10 million and $25 million per year. The most significant expenditure is on ongoing application and supporting infrastructure maintenance. The remainder is spent on heating, computer room air conditioners, property taxes, and labor expenses.

Cost To Build In-house Data Center

A small data center will set you back around $1000 per square foot to construct. That isn’t taking into account that laying fiber to your location might cost thousands of dollars each mile. The average commercial data center availability center costs between $10 million and $12 million per megawatt to construct, with most of the expense incurred during the initial few megawatts of deployment. Companies are rapidly changing business needs, and evolving technology has compelled them to make considerable upgrades to their infrastructure. Should companies decide to hire these facilities, they may be expected to help them meet IT demands.


A typical data center for single-tenant use may take 12-24 months to be ready through planning, engineering, construction, and commissioning phases. However, existing co-location facilities providers can get spaces prepared in weeks, a fraction of the time it takes to develop.

Core Business and Staffing

Setting up a data center, by definition, entails moving time, knowledge, experience, and additional workforce personnel away from the core business to address the data center’s specialized needs, such as power supply and cooling.

Ongoing Support

Businesses must also consider the initial startup expenditures for building and acquiring real estate the continuing operating expenses of power, heating, air conditioning, and security and maintenance.


The projected life cycle is ten years or more when constructing a single-tenant data center. This might cause initial overbuilds to be added to capital, physical infrastructure, and energy consumption expenses. If the data center is too big, the total cost of each rack will be more significant. If a company’s data center is too small, it will run out of space sooner than anticipated and lose the cost-saving benefits of scale. The primary use of co-location services allows businesses to expand or shrink their presence as needed. In the world of data center co-location, suppliers compete to provide you with the most cost-effective solutions available. You can add or remove capacity rapidly and inexpensively in co-located facilities.

Cost to build a data center

Shared Cost Structure

The user pays all of the expenses associated with a single-tenant data center, such as space, power, and environmental infrastructure. A co-location service provider lowers the fixed costs of facility management, maintenance, security, and data center infrastructure for its customers.


Connectivity costs from carriers and ISPs may increase when you add fiber and local loop expenses to your data center. This can also add time to the facility’s entire operation. Carriers generally have a backup data center inside their facilities, eliminating additional local loop costs. Co-locations provide services that may need to pay for the construction of fiber entrance facilities or provide incentives to entice the carrier to extend its fiber network connectivity into the data center industry.


The cost of certifications and the criteria and procedures that must be in place for them, such as SSAE16 and HIPAA, needs to be factored in.

Co-locate with 365 Data Centres

Data Centers is a laser-focused firm dedicated to providing reliable and secure co-location, network, and cloud providers service. A new data center components feature security monitoring, and Without appropriate maintenance, your equipment and infrastructure that supports it will wear out over time.

Cost Examples of Building a Data Center In-house

Mid-sized Enterprise Data Centers (5,000 square feet)

  • A Tier II facility with 160 racks, each with a capacity of 5.0 kW/rack (800 kW of UPS-protected power)@ 5.0kW/rack. (5,000 sq. ft. X $300/sq. ft.) + (800 kW x $12,500/kW) = $11.5 million
  • A Tier Level III level facility, with 160 racks at 10.0 kW/rack (1,600 kW of UPS-protected power) @ 10.0kW/rack. (5,000 sq. ft. X $300/sq. ft.) + (1,600 kW x $23,000/kW) = $38.3 million

Small Data Center (1,000 square feet)

  • A Tier Level II level facility with 32 racks at 5.0 kW/rack (160 kW of UPS-protected power) @ 5.0kW/rack. (1,000 sq. ft. X $300/sq. ft.) + (160 kW x $12,500/kW) = $2.3 million
  • A Tier Level III level facility, with 32 racks at 10.0 kW/rack (320 kW of UPS-protected power) @ 10.0kW/rack. (1,000 sq. ft. X $300/sq. ft.) + (320 kW x $23,000/kW) = $7.7 million

Large “Telco Room” (500 square feet)

  • A Tier Level II facility with 16 racks at 5.0 kW/rack (80 kW of UPS-protected power) @ 5.0kW/rack. (500 sq. ft. X $300/sq. ft.) + (80 kW x $12,500/kW) = $1.2 million
  • A Tier Level III facility, with 16 racks at 10.0 kW/rack (160 kW of UPS-protected power) @ 10.0kW/rack. (500 sq. ft. X $300/sq. ft.) + (160 kW x $23,000/kW) = $3.8 million

What is the Difference Between a Data Center and The Cloud?

A data center is a facility where server rooms and data storage are housed for an organization. The components of a data center include the hardware, the area in which it is housed, power and backup systems, environmental controls, and anything else needed to keep those servers up and to run.

Cloud companies may have their own data centers, but organizations frequently maintain their own data centers, known as on-premises or on-prem for short. When most people talk about their data centers, they refer to on-premises data centers.

How is a Cloud Data Center Different?

A public cloud data center is a facility that provides as-a-service applications and workloads. For example, a software-as-a-service vendor might store all of the program’s requirements on servers in one or other data centers and allow clients to access it via an internet connection. Instead, the software is run on a large data centers server rather than on each user’s computer room.


The need for dependable and scalable data center space to co-locate IT infrastructure rises as businesses develop. A data center or power outage might have severe consequences for a firm in the form of decreased productivity, client churn, and revenue loss. Successful businesses often outgrow their in-house computer and telecom room quickly. They also need appropriate working conditions to allow software development, testing, quality assurance, and production apps. Furthermore, as firms attract business clients, compliance and security standards become more important.

Before extending your data center, you should assess the costs, risks, and potential benefits of creating an in-house data center versus buying co-location services.

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