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Ora Reynolds (left), president of Hunt Midwest Real Estate Development, and Tammy Henderson, director of real estate marketing and governmental affairs, are preparing for when a portal (background) will be the front door to an underground data center.

Hunt Midwest Real Estate Development Inc. is getting into the data center business — or rather, under it. Subtechkc

The Kansas City-based company plans to build a 40,000-square-foot data center in Hunt Midwest SubTropolis. The massive underground business complex is roughly northeast of Interstate 435 and Missouri Highway 210 in Kansas City.
Construction on the estimated $30 million SubTech project will begin once Hunt Midwest signs a tenant or tenants for the first 20,000 square feet, company President Ora Reynolds said.
Reynolds said the company originally planned a 100,000-square-foot project but scaled back after an unsuccessful attempt in the summer to add state tax incentives for data centers to a bill aimed at retaining automotive jobs. Missouri is at a disadvantage, she said, because Kansas, Nebraska, Iowa and Oklahoma offer financial breaks for data centers.
“The investment in a data center is so much more expensive than a regular building,” Reynolds said. “The investment is so large you can’t do ‘If you build it, they will come’ if you don’t think you can compete.”
Reynolds said the company envisions a Tier 3 facility, meaning it has redundant power and cooling systems, with the ability to expand in 20,000-square-foot increments.
“The thing that we’re saying is the biggest advantage, and what makes us different, is we have 8 million square feet that has been mined out and has not been developed at the present time,” Reynolds said. “Somebody who’s out there and says, ‘I need 20,000 square feet now, but I know I’m going to grow and need 100,000 square feet in the next five years,’ we can accommodate them while somebody who has an office building wouldn’t let half the building stay empty.”
She said Hunt Midwest would be strictly a landlord, preferring to find a managed services/collocation firm to become the main tenant, subleasing rack and cabinet space to smaller companies or leasing entire data suites or powered shells — where the tenants install most of the technical infrastructure themselves.
The data center business has taken off in recent years as companies have looked for options to remotely operate or back up data networks.
New York-based Tier 1 Research said in a Sept. 23 report that demand has outstripped supply in many markets because the economy has slowed construction and financing of new data centers.
The underground data center is relatively new in the industry, despite the obvious increase in security and resistance to natural disasters.
Tier 1 analysts Jason Schafer and Michael Levy said in a separate report looking at the SubTech project that so-called data bunkers have had trouble attracting tenants in other markets because of the added complexity of supplying power and getting rid of excess heat and moisture.
They said that SubTech does have size and the ability to grow in phases going for it but that it will run into the same skepticism other operators encounter.
“This isn’t to say that there isn’t a market for a secure underground data center facility,” they wrote. “It just fits the needs of fewer types of tenants that are likely comparing all data center providers.”
Cavern Technologies operates a 40,000-square-foot data center in the underground Meritex Lenexa Executive Park. Cavern President John Clune said the company has grown from four customers three years ago to 35.
“Our market has really taken off,” he said, adding that not having to construct an actual building and underground’s cooler air temperatures let Cavern compete on cost. “The economics of the underground allow us to provide more space for the money.”
Clune said that data centers typically charge as much as $1,200 a rack but that he charges $2,900 for 250 square feet — enough room for four racks.
“It’s when people come down here that the light goes on,” he said.
Numerous area companies operate their data centers, including some in underground space.
Overland Park-based Sprint Nextel Corp. has three data centers supporting network operations, with two built into earthen embankments, spokeswoman Melinda Tiemeyer said.
Other companies use underground caves to store computer data tapes.

What is SubTropolis?

SubTropolis was created through the mining of a 270-million-year-old limestone deposit. In the mining process, limestone is removed by the room and pillar method, leaving 25-foot square pillars that are on 65-foot centers and 40 feet apart.

The pillars’ even spacing, concrete flooring and 16-foot high, smooth ceilings make build-to-suit facilities time and cost efficient for tenants. A tenant requiring 10,000 to one million square feet can be in their space within 150 days. SubTropolis is completely dry, brightly lit, with miles of wide, paved streets accessed at street level.

Hunt Midwest SubTropolis sets the standard for subsurface business developments.

Read more: Hunt Midwest seeks tenant for SubTech underground data center space - Denver Business Journal