Data Centers

Sutherland attorneys provide seamless advice on all aspects of mission-critical data centers to developers, owners, operators and tenants.

Business intelligence and access to critical information are essential to the success of today’s organizations. Sutherland lawyers understand all aspects of mission-critical data facilities, from development and leasing to tax issues and power purchase agreements. Since 1998, we have advised developers, owners, operators and tenants on the issues associated with all types of data centers, including enterprise, wholesale, colocation and managed services facilities. Through our comprehensive team approach, we advise clients in build-to-suit and sale/leaseback transactions for single user facilities and in leasing cages, cabinets and private suites within multi-user buildings.

Our uncommon level of experience allows us to anticipate and manage the many challenges inherent in developing and owning complex data centers, including site selection, due diligence, tax incentives, financing, operations, leasing and service level agreements. We understand the full range of tenant concerns as well, especially the complexities of lease agreements. Because data centers are energy-intensive, we place an emphasis on electricity requirements, including cogeneration options and the integration of onsite renewables, along with the associated regulatory, tax and environmental considerations.

Our interdisciplinary approach spans the entire data center development process. During the site selection phase, we help enterprise data center users negotiate substantial state and local tax incentives and analyze due diligence. For projects that include a renewable energy component, we help clients obtain tax credits and incentives, negotiate power purchase agreements and navigate applicable government regulations. We also assist with negotiating design and construction contracts, build-to-suit leases and joint venture agreements.

The number of companies that rely on data centers grows each day, along with the complexity of their needs. Sutherland’s interdisciplinary Data Center Practice can help.

Why Sutherland

Only a handful of law firms offer a dedicated data center practice, and Sutherland was one of the first to develop a full-service team to provide counsel on the many legal facets of these mission-critical facilities. Our knowledge of the data center industry and our long experience in the field set us apart. As data centers grow in size and significance over the coming years, other law firms are sure to enter the area, but none can match our understanding of how data center law has evolved, and where it’s going.

Since we launched our practice, we have seen the role of data centers change rapidly. Organizations now create more and more information through the exploding use of social networking, smartphones and cloud computing. Increasingly complicated financial systems, regulatory requirements and compliance demands all require more data, and more sophisticated data use. From healthcare to banking, information needs are multiplying, and redundancy is critical.

Things are changing fast. As existing data servers age, organizations need to develop back-up systems to ensure their information is secure and accessible. As servers get smaller and hotter, older facilities must be phased out to accommodate the power and cooling needs of the latest technology. And as the demand for data centers outgrows supply, clients need experienced counsel who can provide the guidance necessary to ensure they get it right the first time, whether they are building a new facility from the ground up or just renting space.

Representative Experience

Our team brings together attorneys who have experience with real estate, tax, construction, data security, regulatory requirements and energy issues.
We have:

Represented a developer of enterprise and wholesale data centers throughout the United States. For one development, we negotiated a $200 million tax incentive package, design and construction contracts, and operations and maintenance agreements, and prepared leases and service level agreements.
Advised a client in the acquisition, financing, development and sale of 56 Marietta Street, a 160,000-square-foot building fully dedicated as a telecommunications/interconnect facility and known as Atlanta’s premier carrier-neutral data center. We negotiated numerous leases, including more than 150 leases for “meet me room” space.
Assisted an enterprise data center user in obtaining a state and local tax incentive package worth more than $35 million.
Advised multiple owners of data centers in downtown Atlanta, Georgia, in connection with development and leasing matters. We negotiated numerous leases for “meet me room” space and service level agreements.
Assisted a client in acquiring, developing and leasing numerous single user data centers and call centers throughout the United States, including more than one million square feet in Georgia, Idaho, Louisiana, Kansas, Maine, Missouri, Oregon, Tennessee and Texas.
Represented a major healthcare company in simultaneously negotiating two data center leases in the southeastern United States.
Assisted clients with varying power needs with leases ranging from a few racks to 1 megawatt.

Nuts and Bolts
Sutherland provides comprehensive services for data center development, operations and leasing, including:

Development
Leasing agreements and service lease agreements
Cogeneration and power development
Data security
Tax incentives
Regulatory and compliance
- Statement on Standards for Attestation Engagements (SSAE) No. 16
- Health Insurance Portability and Accountability Act (HIPAA)
- Health Information Technology for Economic and Clinical Health (HITECH) Act
- Payment Card Industry (PCI)
- Gramm–Leach–Bliley Act
- Sarbanes-Oxley Act

Sutherland’s data center attorneys have the experience to guide developers, owners, operators and tenants through every aspect of developing, operating or managing mission-critical data center facilities. We can help develop and manage facilities and agreements that are strategic and advantageous.