Why Secondary Markets Are Primary Opportunities for Data Center Growth
Once viewed primarily as overflow options or disaster recovery sites, secondary markets have evolved into frontline destinations for data center expansion. As primary metros grapple with power constraints, multi-year grid connection delays, and escalating costs, regions like Cheyenne, McAllen, Milwaukee, Portland, and South Bend are delivering what enterprises need most: abundant energy, strategic connectivity, and accelerated deployment timelines. For fifteenfortyseven Critical Systems Realty (1547), these markets represent more than geographic diversity. They are central to the company’s interconnection-first strategy, transforming regional positioning into competitive advantages for AI, cloud, and enterprise deployments.
A Shifting Landscape for Data Center Deployment
The narrative around primary data center markets has shifted dramatically. According to Mordor Intelligence, Northern Virginia, the world’s largest data center market, faces grid constraints that have resulted in connection pauses and extended wait times. Colocation vacancy rates have plummeted to historic lows, falling below 2.5 percent in many primary markets. Grid queue timelines exceeding four years have become increasingly common. For organizations racing to deploy AI workloads or expand cloud infrastructure, these delays translate directly into lost momentum and constrained growth.
Secondary markets bypass many of these bottlenecks. Markets like Cheyenne offer scalable capacity tied to nearly 2.7 GW of regional hyperscale development. McAllen benefits from diverse power sourcing and cross-border network access. South Bend sits near established hyperscale cloud regions, while Milwaukee and Portland deliver carrier density without the congestion of larger metros. As noted by Apto DC, these regions can offer meaningful cost advantages and deployment timelines measured in months rather than years.
Why Secondary Markets, and Why Now
Geographic positioning defines secondary market advantages. Located near major hubs yet free from their congestion, these markets provide low-latency access to population centers and stable operating environments. Wyoming offers abundant renewable energy resources that support high-density deployments. Texas provides grid diversity and favorable regulatory conditions. Midwest sites like Milwaukee and South Bend cut latency to Chicago and the broader Great Lakes region while maintaining direct fiber routes to both coasts.
Infrastructure resilience reinforces this strength. Hardened construction, redundant power configurations, and carrier-neutral designs support high-availability operations and long-term scalability. As a result, secondary markets are increasingly attracting workloads priced out of primary metros or stalled in grid queues, from AI training clusters to hybrid cloud environments and latency-sensitive edge applications.
1547’s Role Across Secondary Markets
Across its portfolio, 1547 anchors this trend with facilities that blend connectivity strength with regional advantages. Each location addresses specific market needs while contributing to a broader ecosystem that supports distributed deployment strategies.
Cheyenne, Wyoming
Cheyenne (CHWY1) provides disaster-resilient infrastructure on more than 10 acres with scalable power capacity and low-latency connectivity to New York, Chicago, and Dallas. Recent regional approvals supporting up to 2.7 GW of hyperscale development underscore the market’s long-term growth potential.
McAllen, Texas
McAllen’s Chase Tower facility (MCTX1) hosts more than 45 carriers and recently launched the McAllen Internet Exchange (MCT-IX), strengthening its role as a cross-border gateway for U.S. and Latin American traffic. With a 3 MW annex scheduled for Q4 2026, the facility supports enterprises seeking diverse network routes and proximity to growing Latin American markets.
Milwaukee, Portland, and South Bend
Milwaukee delivers cost-effective Midwest connectivity with direct access to Chicago-area networks and carriers. Portland’s Pittock Block offers dense carrier access in a historic downtown building adapted for modern data center operations. South Bend’s Union Station is undergoing phased expansion through 2028, benefiting from proximity to hyperscale cloud regions and direct fiber routes to Chicago and Indianapolis.
Together, these facilities support distributed architectures and hybrid deployment models, enabling organizations to place workloads where performance, power availability, and connectivity align best, without sacrificing access to the broader digital ecosystem.
Looking Ahead
Secondary market importance will continue to grow as AI demand accelerates and operators seek alternatives to constrained primary hubs. As distributed architectures become standard, the distinction between primary and secondary markets will continue to narrow. What remains critical is infrastructure that delivers reliable power, strong interconnection, and deployment timelines aligned with business needs.
1547 remains focused on strengthening these regional ecosystems. By investing in markets that combine connectivity, power availability, and operational flexibility, the company continues to support the next phase of digital infrastructure growth, without the constraints increasingly defining traditional primary metros.