The cost of colocation services is dependent on many different factors. Labor costs for the skilled technical team that manages the data center can be high. Capital expenses for air conditioners, UPS systems, and generators are significant. Fire suppression systems, security systems, and monitoring tools are also costly. However, for most colocation data centers, the cost of electrical power and real-estate expenses constitute the two largest components of total colocation cost.
Connecticut is burdened with some of the highest electricity costs in the country. It also has very expensive real estate. With costs so high, where can companies go to achieve colocation savings if they require a colocation facility in Fairfield County? Since electricity rates do not vary much for most data centers in the region, real estate expense is the one variable that can make some Connecticut colocation providers more cost-effective than others.
Office Space in Shelton Costs a Lot Less
Business owners in Connecticut are aware of the big difference in office rent paid from one town to the next. This is especially true in Fairfield County. Data recently reported by commercial real estate leader Cushman Wakefield for the first quarter of 2023 shows that organizations with offices in lower Fairfield County pay twice as much as those in Shelton for comparable space. As the chart below illustrates, the average rent in Shelton for Class A office space is $20.25. This is less than half the rate for comparable space in Greenwich, Stamford, and Westport.
|Average Asking Rent Per Square Foot
Class A Office Space First Quarter 2023
Cushman Wakefield Marketbeat Report
Location is the primary reason for this disparity. Though it is within a forty-five minute drive from any town in Fairfield County, Shelton is generally not practical for those who regularly commute to New York City. The cities and towns that are within commuting distance of Manhattan have the most expensive residential and commercial real estate. The average rental rates shown above, with only a few exceptions, show a direct correlation between distance from New York City and office lease costs.
Achieving cost savings is a high priority for most organizations. Many companies economize by downsizing their offices. The trend to reduce office space under lease has grown recently. Working from home during the pandemic established that remote work can be done productively. Employees favor continuing at least some level of hybrid work so they can come into the office a few days and work from home the rest of the week.
Colocation in Shelton Saves Money
Colocation provides flexibility as changes are made to office floor plans. Moving information technology infrastructure out of the office to a colocation data center frees up space. If the office is in lower Fairfield County, money can be saved by placing IT systems at a colocation facility with significantly lower real estate costs.
For those companies in the metropolitan New York area, colocation savings can be realized by choosing CAPS. CAPS is the only data center in Shelton. With CAPS you can leverage Shelton’s attractive real estate market to benefit from the lowest office costs in the a