Report: Houston sees uptick in data center leasing activity

by the numbers

According to a report from CBRE, Houston registered the eighth-most data center leasing in North America in first half of 2021. Photo by Christina Morillo/Pexels

Houston's data center market is electrified. In the first half of 2021, the local data center market saw the eight highest amount of leasing activity among the 17 North American markets tracked by commercial real estate services company CBRE.

In the first half of this year, the Houston data market experienced net absorption of 5.7 megawatts worth of capacity, up 119 percent from the first half of last year, CBRE says. Net absorption is a key indicator of leasing activity.

During the past year, Houston has added 5.1 megawatts of inventory, dropping the vacancy rate for data centers to 18.5 percent, according to CBRE.

"There have been a few large transactions in the first half of the year that added to Houston's increased absorption numbers," Brant Bernet, senior vice president in CBRE's Dallas office, says in a September 7 news release. "The major storyline for the Houston market is investor interest."

A handful of data center acquisitions already have occurred this year in the Houston area, and more could be on the horizon, Bernet said. Datacenters.com lists 20 privately owned data centers in the Houston area. Among all landlords, Dallas-based CyrusOne owns the most data centers in the Houston market — four.

In June, Las Vegas-based data center operator Switch completed its purchase of Austin-based data center company Data Foundry for $420 million. In Houston, Data Foundry operated two data centers totaling 370,000 square feet. At the end of 2021, Switch plans to develop more data centers in Houston and Austin that are set to open in 2023.

The smaller of Switch's two newly acquired data centers here is a 20,000-square-foot facility at 5555 San Felipe St. in West Houston. The larger one, encompassing 350,000 square feet, sits on an 18-acre site at 660 Greens Pkwy. in North Houston.

In March, Vienna, Virginia-based data center operator Element Critical purchased Skybox Datacenters' facility in Katy for an undisclosed amount. The more than 96,000-square-foot data center sits on 20 acres at 22000 Franz Rd. Skybox is based in Dallas.

A CBRE report indicates Houston's data center market remains dominated by international energy companies, finance companies, and regional health care providers. Demand comes largely from locally based companies.

Phillip Marangella, chief marketing officer at Herndon, Virginia-based EdgeConneX, is among insiders in the data center industry who are bullish about the future of data centers. EdgeConneX operates a 93,400-square-foot data center at 1510 Prime West Pkwy. in Katy.

"Data centers will be processing more workloads, more data, more video, more machine learning, and [will be] serving as facilitators for a global transformation in business, even smaller or more regional enterprises," Marangella tells Data Center Frontier. "Data centers are becoming part of an infrastructure fabric of capacity, connectivity, power, and proximity that is empowering enterprises to take advantage of the location, the scale, and the economics that work for them."

Edward Henigin, CTO of Data Foundry, sums up what he thinks the future of work from home will look like. Photo by Maskot/Getty

Texas expert: What does the future of remote work look like?

guest column

Since the start of the pandemic, the idea that this event will change the way we live and work now and, in the future, has been a on the minds of everyone.

It's true that remote work has become a mainstay of day-to-day operations, and now the traditional offices are looking more and more like the office environment of the past. In a recent survey published in July 2020, it revealed that before the pandemic, only 17 percent of responding U.S. employees worked from home at a rate of five days or more per week. At the time, this survey was conducted in April, however, that share had increased to 44 percent. Even as pandemic response developed, a Gallup poll from October revealed that 33 percent of U.S. workers were still working remotely.

So, the question remains: What will the future of remote work look like for enterprises?

Changes we've seen so far

Businesses have already been finding their footing with the assistance of an array of platforms and solutions, all of which have helped them pivot quickly and successfully through the use of more digital means. Right now, we see that cloud-based collaborative applications like Microsoft Teams, Slack, and Zoom (which had its daily user numbers more than quadruple by April 2020) have become the backbone of many new workplace IT strategies, offering an ability to bridge the distance and ensure seamless cooperation.

Meanwhile, to keep a growing number of endpoints and devices secure as employees use home networks and personal computers to log onto work environments, Virtual Private Networks (VPNs) have become key. Studies show that VPN usage increased by 124 percent in the U.S. between March 8 and March 22, 2020. This can be attributed to the technology's ability to help businesses ensure protected file sharing, data encryption, secure remote access, and more. These are all crucial elements for keeping the expanding footprint of the enterprise network safe.

Finding a balance

There is no one-size-fits-all approach to managing remote work transitions. Some businesses will require more on-site work while others may make a more comprehensive transition away from central office locations. As we move forward, it's likely that we'll see many organizations settle somewhere in the middle with a hybrid strategy that allows distanced operations where feasible and on-site work where needed.

Overall, it's clear that across these many different applications and use cases, the importance of digital infrastructure has increased. Regardless of what platforms or services are in use, the network and other foundational IT infrastructure have become central to success as businesses expand their bandwidth needs, incorporate data-centric solutions, and depend on reliable, speedy communications. It will be crucial moving forward that businesses not only adapt to the challenges they currently face, but plan for a flexible long-term work strategy.

Understanding how the company will need to function and what services it will need to achieve success in any given strategy will be paramount, and after an individualized vision is developed, technology action plans will need to start rolling out. For some this may mean adjusting IT equipment environments (like moving on-premises data center assets to outsourced facilities), for others this may mean expanding their networks or implementing new cloud-based connectivity.

All in all, agility and flexibility are at the core of the reimagined enterprise, and planning is the enabler of both these business virtues. Now is the time to look forward, not only for the sake of preparation, but for the sake of keeping our eyes on a brighter, stronger, and more dynamic future.

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Edward Henigin is CTO at Austin-based Data Foundry, which has a growing data center location in Northwest Houston.

Data Foundry debuted its most recent expansion in North Houston, but that's just the start of the Austin-based company's growth in the Bayou City. Photo courtesy of Data Foundry

Data center in North Houston unveils newest expansion — with more growth planned

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Data Foundry Inc. may be finished with its 27,000-square-foot expansion at the company's data center in North Houston, but it's by no means finished growing at the site.

The Austin company's 18-acre, master-planned campus at 660 Greens Pkwy. allows for another 200,000 square feet. At build-out, Data Foundry will operate 350,000 square feet of space there.

Currently, the data center encompasses 150,000 square feet. The recent expansion completes the development's first phase. Each of two future phases will add 100,000 square feet.

So far, there's no timetable for the data center's second and third phases.

"It's all a function of demand. We will deploy the capital in response to the pace at which we end up filling up the new space," says Ed Henigin, chief technology officer of Data Foundry.

The 27,000-square-foot expansion debuted in late January at Data Foundry's Houston 2 Data Center. Henigin says space remains available there, but the company does have prospective tenants in the pipeline. It could take anywhere from six months to four years to lease the entire expansion, he says.

Data Foundry says increased customer demand along with business growth in Houston — especially in the healthcare, energy, and manufacturing sectors — prompted the four-megawatt expansion.

"For folks who are outside of Houston, it's an underappreciated market," Henigin says. "It's a huge economy, and there's a lot of dynamic activity happening in Houston and a lot of growth."

Generally, demand for data center space in Houston is "steady and healthy," Henigin adds.

"I don't think we're really overserved or underserved at this point. I think we're pretty well-balanced," he says.

Henigin points out that demand can shift depending on the region's economic conditions, such as upswings or downturns in the energy sector.

"A lot of the folks who have businesses in Houston have learned to be a little cautious, because you don't necessarily know when the next dry spell is coming," he says. "So there's a lot of careful planning or careful execution in business practices in order to be resilient."

Although Houston ranks as the fifth largest metro area in the U.S., it's not among the country's 10 biggest data center markets, unlike Dallas-Fort Worth and Austin/San Antonio. According to DataCenterMap.com, 40 data centers operate in the Houston area. A number of the region's data centers are in North Houston, The Woodlands, and Katy, according to datacenterHawk.

Among Data Foundry's competitors in the Houston market are CyrusOne Inc., Skybox Datacenters LLC, and Stream Data Centers LP — all based in Dallas — and San Francisco-based Digital Realty Trust Inc., according to datacenterHawk.

Customers of Data Foundry's Houston 2 Data Center include Carrizo Oil & Gas Inc., FMC Technologies Inc., Marathon Oil Corp., and Mattress Firm Inc. — all based in Houston — and Galveston-based Moody National Bank.

Houston 2 offers a 185 mph wind-rated infrastructure and an elevation above the 500-year floodplain. During Hurricane Harvey, tenants didn't lose power or network service, or experience flooding, Data Foundry says.

Data Foundry has operated data centers in the Houston area since 2002. Its other Houston data center, inside the Marathon Oil Tower at 5555 San Felipe St., comprises 20,000 square feet.

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Houston medtech startup clears FDA approval for new surgical tool

precision surgery

Houston-based Prana Surgical will soon bring a new electrosurgical tool to operating rooms around the country. The Prana System officially cleared U.S. Food and Drug Administration (FDA) approval earlier this month.

"Receiving FDA clearance for the Prana System represents a defining milestone for our company," Joanna Nathan, CEO and co-founder of Prana Surgical, said in a news release. "Surgeons today are increasingly focused on achieving precise outcomes while minimizing disruption to healthy tissue. The Prana System was designed to support that shift by integrating targeting and excision into a single, streamlined tool."

Prana Surgical began as Prana Thoracic in 2022. Back then, the company primarily focused on developing screening tools for lung cancer diagnosis. It raised $6 million in series A funding rounds in 2023 and 2024 before transitioning to broader surgical needs in 2025.

The Prana System is a minimally invasive, image-guided, single-use tissue extraction tool designed to retrieve samples without damaging healthy tissue. The tool is still designed with the respiratory system in mind, helping Prana in the fight against lung cancer and other thoracic diseases.

Reducing the impact of tissue extraction via electrosurgery and enhanced image scanning can significantly reduce complications. The Prana System combines localization and tissue-cutting capabilities in one, which keeps surgeons from having to swap out components during a procedure, making for a smoother process. It can core, cut and feel blood vessels on the way toward the intended target, giving surgeons greater control over tissue preservation.

"Electrosurgery is foundational to modern surgery, but there is still opportunity to improve how energy-based tools are applied in minimally invasive settings," Nathan added. "Our goal is to introduce a new class of image-guided surgical tools that enable more precise intervention across a range of procedures."

The company projects sales of $7.5 billion from the Prana System in the United States, estimating that 2.5 million surgical modules will be able to use the new tool. While starting out focused on biopsies, the company plans to evolve the system into other procedures, such as ablation, in the future. It is also planning for a controlled U.S. clinical rollout as it moves toward commercialization

Texas still ranks as No. 1 in U.S. for inbound moves, but growth dips

by the numbers

Texas continues to be the country’s No. 1 magnet for newcomers from other states, giving a boost to the state’s economy. However, Texas’ appeal weakened in 2024 compared with the previous year, due in large part to spiking home prices.

An analysis of U.S. Census Bureau data by self-storage platform StorageCafe shows Texas saw net interstate migration of 76,000 people in 2024. Texas’ net interstate migration dropped nearly 50 percent from 2023, according to the analysis. Net migration refers to the number of incoming residents minus the number of outgoing residents.

California remained the top source of newcomers for Texas, sending nearly 77,000 residents to the Lone Star State in 2024, the analysis says. Florida ranked second, followed by New York, Colorado and Illinois.

“These trends reveal Texas’ continued pull from both high-cost coastal markets and other large Sun Belt states, resulting in a mix of affordability-driven and job-driven relocation,” StorageCafe says.

Putting a damper on the influx of new residents: a roughly 124 percent surge in Texas home prices over the past decade, according to StorageCafe.

“While the state remains significantly more affordable than California, its top feeder state, the once-wide pricing gap has narrowed,” says StorageCafe. “For many movers, Texas is still a relative bargain, but no longer an undisputed one.”

Nonetheless, Texas keeps attracting young, highly educated people, which bodes well for the state’s long-term economic outlook, StorageCafe says. More than half of new arrivals to Texas in 2024 held at least a bachelor’s degree, and the age of newcomers averaged 32.

Where are most of these young, highly educated newcomers settling?

Lloyd Potter, former Texas state demographer, tells StorageCafe that population growth in Texas is happening most rapidly in suburban “ring counties” at the expense of slowing growth in urban cores. Ring counties are on the outskirts of major metro areas.

“Many people are moving from urban cores to suburban rings seeking lower costs, newer housing, better schools, and more space,” Potter says. “Typically, a move to a suburban county will be within commuting or hybrid‑commuting distance of major metro economies.”

Artemis II makes historic call to space station with help from Houston Mission Control

History in the making

Still aglow from their triumphant lunar flyby, the Artemis II astronauts made more history Tuesday, April 7: calling their friends aboard the International Space Station hundreds of thousands of miles away as they headed home from the moon.

It was the first moonship-to-spaceship radio linkup ever. NASA's Apollo crews had no off-the-planet company back in the 1960s and 1970s, the last time humanity set sail for deep space.

"We have been waiting for this like you can’t imagine,” Artemis II commander Reid Wiseman called out.

For Christina Koch on Artemis II and Jessica Meir aboard the space station, it marked a joyous space reunion despite being 230,000 miles (370,000 kilometers) apart. The two teamed up for the world's first all-female spacewalk in 2019 outside the orbiting lab.

Koch told her “astro-sister” that she'd hoped to meet up with her again in space “but I never thought it would be like this — it's amazing.”

“I'm so happy that we are back in space together,” Meir replied, “even if we are a few miles apart.”

Houston's Mission Control arranged the cosmic chitchat between the four lunar travelers and the space station's three NASA and one French residents.

Koch described being awe-struck by not just the beauty of Earth, “but how much blackness there was around it.”

“It just made it even more special. It truly emphasized how alike we are, how the same thing keeps every single person on planet Earth alive,” she told the space station crew. “The specialness and preciousness of that really is emphasized” when viewing the home planet from the moon.

By late Tuesday afternoon, the Artemis II astronauts had beamed back more than 50 gigabytes' worth of pictures and other data from the previous day's lunar rendezvous, which set a new distance record for humanity. The highlight: an Earthset photo reminiscent of Apollo 8's Earthrise shot from 1968.

"While they are inspirational and, I think, allow all of us to really feel a little bit of what they were feeling, there's also a lot of science hidden inside of those images," said Mission Control's lead lunar scientist Kelsey Young. “The conversations and the science lessons learned are just beginning."

During a debriefing with Young, the astronauts recounted how they spotted a cascade of pinpricks of light on the lunar surface from impacting cosmic debris. The flashes lasted mere milliseconds and coincided by chance with Monday evening's total solar eclipse.

Young said it was too soon to know whether the crew witnessed an actual meteor shower or more random, run-of-the-mill micrometeoroid hits. Either way, there were “audible screams of delight” in the science operations center, she said.

Koch described being awe-struck by not just the beauty of Earth, “but how much blackness there was around it.”

“It just made it even more special. It truly emphasized how alike we are, how the same thing keeps every single person on planet Earth alive,” she told the space station crew. “The specialness and preciousness of that really is emphasized” when viewing the home planet from the moon.

The first lunar explorers since Apollo 17 in 1972, Wiseman and his crew are aiming for a splashdown off the San Diego coast on Friday to wrap up the nearly 10-day test flight. The recovery ship USS John P. Murtha left port Tuesday for the target zone.

It sets the stage for next year's Artemis III, a lunar lander docking demo in orbit around Earth. Artemis IV will follow in 2028 with two astronauts attempting to land near the lunar south pole.

As for the Orion capsule’s pesky potty, Mission Control assured the astronauts that no maintenance was required Tuesday. The toilet has been on-and-off limits to the crew ever since last week’s launch, prompting them to rely on a backup bag-and-funnel system for urinating.

NASA Administrator Jared Isaacman told the crew following the lunar flyby Monday night: “We definitely have to fix some of the plumbing” ahead of the next Artemis mission. Engineers suspect a clogged filter in the overboard flushing system.

Aside from the toilet and other relatively minor matters, the mission has gone well, Isaacman noted at a news conference Tuesday, “but I'll breathe easier when we get through reentry and everybody's under chutes and in the water.”

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