Data Centers in South Jersey
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South Jersey – A Strategic Alternative to Major Hubs
South Jersey provides a compelling data center colocation option for enterprises seeking a strategic location with lower operational costs than primary markets like New York City and Philadelphia. Its proximity to these major hubs offers excellent latency for financial, pharmaceutical, and logistics industries, delivering resilient infrastructure without the premium price tag.
South Jersey: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid connectivity, though not a primary international hub; serves the region effectively. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Access is via network extension to major hubs like Philadelphia or New York. |
| Power Cost | $0.11–$0.13/kWh | Industrial electricity rates are competitive for the Northeastern United States. |
| Disaster Risk | High (NRI Score: 75.31) | Risk profile requires careful facility selection and disaster recovery planning. |
| Tax Incentives | Yes | State programs link tax credits to capital investment and new job creation. |
| Sales Tax | 6.63% (New Jersey) | Standard state sales tax applies to equipment and services, as of September 2025. |
Network & Connectivity Ecosystem
South Jersey's connectivity is defined by its proximity to the dense carrier hotels of Philadelphia and New York City.
Carrier Density & Carrier Neutrality: The market contains over 4 distinct providers in 4 facilities, as of September 2025. While local carrier density is modest, access to regional fiber routes connects businesses to hundreds of national and international carriers. Carrier-neutral facilities are the standard, offering choice and competitive pricing.
Direct Cloud On-Ramps: There are no public cloud on-ramps located directly within South Jersey. Businesses connect to cloud providers via private network interconnects (PNI) or dedicated wavelength services to facilities in Philadelphia or the New York/Northern New Jersey corridor, where all major cloud providers have a presence.
Internet Exchange Points (IXPs): Public peering is not a feature of the South Jersey market. The majority of peering occurs privately between networks or is routed through major regional exchanges like the DE-CIX New York or NYIIX.
Bare Metal: Bare metal server options are available, typically through providers that service the broader Philadelphia and New York metropolitan areas. Companies like Hivelocity and ColoCrossing can deliver dedicated servers to facilities in the region.
Power Analysis
Average Cost Of Power: Industrial power costs in South Jersey are estimated between $0.11 and $0.13 per kWh, as of September 2025. This pricing is often more favorable than in adjacent metropolitan centers, providing a tangible operating expense advantage for power-dense deployments.
Power Grid Reliability: The region's power grid is well-engineered to support its industrial and commercial base. Data centers in the area are typically served by redundant power feeds from multiple substations to ensure high levels of uptime.
Market Access, Business & Tax Climate
Proximity To Key Business Districts: Data centers in South Jersey offer low-latency connectivity to the Philadelphia metropolitan area, Atlantic City's gaming and hospitality sector, and the extensive pharmaceutical and logistics corridors running through the state. This makes it ideal for disaster recovery and secondary production sites.
Regional Market Reach: The market effectively serves the entire Delaware Valley, which includes Philadelphia and its suburbs, Wilmington, Delaware, and southern New Jersey. This region represents a significant economic and population center.
Tax Advantage For Data Centers: New Jersey offers a state-level tax credit program that benefits companies making significant capital investments and creating new full-time jobs. This incentive can directly reduce the total cost of ownership for a new data center deployment.
Natural Disaster Risk
South Jersey has a High natural disaster risk profile, with a FEMA National Risk Index score of 75.31, as of September 2025. This score reflects exposure to a combination of frequent, lower-impact events and less frequent but potentially severe weather.
Key risks for consideration include hurricanes, tropical storms, severe winter weather (ice and snow storms), and riverine flooding. Other notable risks for the area are strong winds, lightning, and hail. While earthquakes are listed as a risk, they are a significantly lower probability than weather-related events.
