the 5 phases of building a data center

Building a Data Center

Data centers are some of the world’s most sophisticated structures in terms of resiliency, power, and connectivity.


So what goes into building a data center?


The 5 Phases of Building a Data Center

The general phases of data center development are as follows:


  1. Assessment – In the assessment phase, the developer will first finalize the project’s goals and target audience/customer. They will often conduct site selection, although many experts say that at least the preliminary design should be complete before final site selection.
  2. Planning – In the planning phase, the developer will outline the parameters that will guide the design process.
  3. Design – In the design phase, the developer and their chosen design partner (unless it’s an internal design team) will finalize the designs for the data center.
  4. Construction/Commissioning – In the construction phase, the developer and their general contractor will build the first phase of the facility so that it is ready for operation.
  5. Operation – In the operation phase, the developer/operator will evaluate whether the facility is performing according to the initial design goals and parameters. If the planned project has multiple development phases, this is where the developer would evaluate how Phase 1 went and what changes are necessary for any future development phases.
the 5 phases of building a data center
Image credit: Schneider Electric

We’ll go deeper on each of these five phases in just a bit. We should note that these five phases are not a pure stage-gate cascading process. There is almost always some parallel pathing going on. For example, a developer might be wise to conduct at least some elements of the design process prior to finalizing the site selection.

The main players in data center development are:

Phase 1 - Assessment

The first question to answer in the entire process is whether the data center project will be a build-to-suit or spec build. If it’s going to be a build-to-suit, the client’s specific needs will largely drive the planning and design process. On the other hand, if it’s going to be a spec build, the developer will need to align strategic opportunities with what they think will be most marketable to the target audience. 


Many data center real estate developers have a standard design that they try to apply to all of their projects. That approach has pros and cons. The pros are that the supply chain is simplified and the developer can reach some economies of scale. The cons are that the developer is not quite as able to design each data center development project as they feel is optimal for that particular project. 


Regarding site selection, some of the strategic considerations of a particular data center site are:

  • Available land and applicable zoning (single site vs campus)
  • Existing buildings on and around property
  • Soil testing
  • Topography
  • Water supply
  • Electric power supply
  • Fiber connectivity
  • Natural disaster profile
  • Staffing and accessibility

Phase 2 - Planning

At this point, the developer should have made at least some progress on site selection and design. Up next is to complete plans for the major structural and infrastructural aspects. Key questions for this stage include:


  • What PUE to strive for?
  • New construction or retrofit?
  • How much acreage should the parcel be?
  • Whether the data center will be N, N+1, etc.
  • Will the facility be built in multiple phases or all at once?
  • What’s the intended use case? Hyperscale, retail colo, wholesale colo, etc?
  • Are we trying to power the data center exclusively with renewable energy?
  • Which BMS will we use?
  • Which CMMS will we use?
  • Are there any unique security requirements?
  • What is my staffing plan?
  • What permits will be required and at what stages?
  • What’s the sales and marketing strategy? Will the developer also be the operator? Might a simple powered-shell be the development goal? If the project is a build-to-suit, this step is not necessary.

The answers to these questions will have big implications for the remainder of the process.


Schneider Electric has a great list of 9 common data center planning mistakes to watch out for:


  1. Focus on CAPEX and not TCO – system design choices will impact both capital and operating expenses, so be aware of both
  2. Poor cost-to-build estimate – common cause of schedule slip and design re-iteration. Work closely with design team and include contractor to ensure accurate cost estimates; understand TCO, not just CAPEX
  3. Improper design criteria – not understanding the cost/time impacts of design choices leads to waste and re-design
  4. Choosing site before design criteria – design requirements will drive suitability of a given site
  5. Planning space before design criteria – power density specification should create the space specification
  6. Designing into a dead end – use flexible, modular designs to protect against future uncertainty
  7. Misunderstanding PUE – leads to unnecessary CAPEX expense
  8. Misunderstanding LEED – can upset budgets and schedule
  9. Overcomplicated designs – leads to expense waste and possibly lower reliability

Phase 3 - Design

At this stage, more detailed questions are asked, like what is our rack density goal? Are we trying to achieve a particular sustainability certification for this facility, like LEED or Green Globes? Single story or multiple stories?


As we noted previously, some design elements will inform site selection and other planning elements, just like some site selection aspects will inform parts of the design process.


Another decision the developer must make at this stage is whether to go with a “design-build” one-stop-shop or whether the design and build elements will be handled by separate companies. 


The key players collaborating at this stage are the electrical team, the mechanical team, and the architect team.

Phase 4 - Construction & Commissioning

Now we break ground and begin building a data center! The timeline for the construction stage can vary quite a bit. A very simple powered-shell design might be fully constructed in just 3-4 months. On the other hand, a more complicated hyperscale build-to-suit might take a couple of years to complete. 

Once construction is complete, the developer will begin the commissioning process, which tests the critical functionality of the data center to ensure that it can perform to the design goals. It’s essentially a simulation and stress test. 

Once the facility has been commissioned and the developer is confident that the data center will perform as designed, they can move in new tenants and move to the next stage: Operation.

Phase 5 - Operation

Construction, at least on the first phase of the development plan, is now complete. The operation stage only begins in earnest once customers are occupying the space. At this point, the data center developer is collecting real-time, production environment data on the performance and utilization of the data center. Whether or not the various systems are working well in concert with one another will become clear. 

This is where the developer must be adept at learning quickly and translating those learnings into the next stage of development on the project, as well as to any future projects.


This is the basic blueprint for the major phases of building a data center. How you execute this playbook will vary quite a bit given the type of data center developer in question, and the type of intended use and customer, but the basic structure remains the same.

How do you think this process will evolve over time? Share your thoughts in the comments below.

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