In order to strengthen its data-center platform in Europe, Iron Mountain Incorporated IRM announced the successful development of approximately four megawatts of turn-key data-center capacity in Amsterdam and London. The latest move helped add 1.9 megawatts to both data centers — AMS-1 in Amsterdam and LON-1 in London.
The AMS-1 data center, located in one of the world's largest network ecosystems in Amsterdam, has nearly 13 megawatts of capacity. Also, there are options to further expand its capacity by more than 20 incremental megawatts. The latest expansion involved opening the data center’s seventh hall that was more than 50% pre-leased.
Also, the existing data-center capacity of LON-1, based in the Slough Trading Estate, was fully occupied by one of the largest banking institutions in the world. Further, the recent expansion helped open the facility’s fourth hall, of which 20% was pre-leased. There are provisions for future development of 3.8 megawatts.
Mark Kidd, executive vice president, said, "We are excited to deliver on the next phase of our global data center strategy and increase our IT capacity in critical European markets. Our pre-lease activity in London and Amsterdam also demonstrates that we have the right approach, technical skills and relationships to serve as the trusted guardian of our customers' business assets, whether physical or digital."
Also, the vice president, Eric Boonstra, mentioned that management is working on building customer-friendly data-center offerings in Europe, Middle East and Africa (EMEA).
Notably, data centers will likely keep witnessing a boom market with growth in cloud computing, Internet of Things and big data, and an increasing number of companies opting for third-party IT infrastructure. Over the next five to six years, artificial intelligence, autonomous vehicle and virtual/augmented reality markets will likely register stellar growth. These factors are anticipated to open up growth opportunities for companies like Digital Realty DLR, Equinix, Inc. EQIX and CoreSite Realty Corporation COR.
Specifically, Iron Mountain has fortified its presence in three out of the top four European data-center markets, backed by the growing global and local demand for data centers. With organic growth efforts driving revenues, this REIT keeps investing in fresher opportunities, which will, in turn, boost the company’s financials marching ahead. Further, it remains on track to achieve the company’s Vision 2020.
Iron Mountain targets its growth portfolio, comprising emerging markets, data-center and adjacent businesses, to contribute 30% to total revenues in 2020. The company is focused on strengthening its data-center business and bank on cross-selling opportunities to realize synergies.
Shares of Iron Mountain have gained 7.6% over the past three months compared with 2.1% growth registered by the industry. Currently, the stock carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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