Data Centers in Philadelphia

Philadelphia – Strategic Mid-Atlantic Connectivity Hub

Philadelphia serves as a critical data center market for organizations requiring low-latency access to the dense Northeast Corridor without the higher costs of New York City or Northern Virginia. Its strategic location, robust fiber infrastructure, and favorable tax policies make it a prime choice for disaster recovery, edge computing, and primary production workloads. This market ensures high-speed connectivity to millions of end-users, supporting business continuity and revenue protection.

Philadelphia: At A Glance

Network & Connectivity Ecosystem

Philadelphia provides a rich, carrier-neutral environment that bypasses the network congestion common in larger, neighboring markets.

Carrier Density & Carrier Neutrality With over 30 carriers operating in the region as of September 2025, the market offers deep and diverse connectivity options. Numerous colocation facilities provide access to this competitive ecosystem, ensuring resilient and cost-effective network services.

Direct Cloud On-Ramps The market features over 2 direct cloud on-ramps, enabling private, high-performance connections to 1 cloud region as of September 2025. Direct access is available for major providers, including:

• AWS

Internet Exchange Points (IXPs) The Philadelphia Internet Exchange (PHLIX) is the primary IXP, facilitating local peering and reducing latency for traffic within the metropolitan area. Most large-scale peering is handled through private connections or via network extensions to major hubs in Ashburn and New York City.

Bare Metal Bare metal server options are readily available from multiple providers in the Philadelphia market. This allows for dedicated, high-performance computing without the overhead of virtualization. Providers like Hivelocity and ColoCrossing offer services in the region.

Power Analysis

Philadelphia benefits from a reliable power grid and competitive energy pricing, which are critical factors for any data center deployment.

Average Cost Of Power Industrial power costs in the Philadelphia area typically range from $0.08 to $0.11/kWh as of September 2025. This pricing is competitive for the region and contributes to a lower total cost of ownership compared to more expensive East Coast markets. The state's energy mix is dominated by natural gas and nuclear power, providing stable generation capacity.

Power Grid Reliability The power grid serving Philadelphia's primary data center zones is well-engineered and supported by redundant infrastructure. The reliance on a diverse fuel mix, including a significant nuclear component (around 30%), ensures a high degree of grid stability and uptime for mission-critical operations.

Market Access, Business & Tax Climate

Philadelphia's business environment and tax structure create compelling reasons for data center investment and colocation.

Proximity To Key Business Districts Data centers in Philadelphia are located near the city's central business district, the "Cellicon Valley" biotech hub, and numerous financial and healthcare institutions. This proximity provides low-latency connectivity essential for real-time applications and data processing.

Regional Market Reach Strategically positioned between Washington, D.C., and New York City, Philadelphia can effectively serve the entire Mid-Atlantic region. Colocation in this market allows businesses to reach over 60 million people with minimal network delay.

Tax Advantage For Data Centers Pennsylvania provides a significant tax incentive for data center operators and tenants. The state's Computer Data Center Equipment Exemption Program removes the 6% state sales and use tax on qualifying equipment purchases, directly lowering capital expenditure. This program makes building out or refreshing hardware more affordable.

Natural Disaster Risk

Philadelphia has a high natural disaster risk profile, with a Federal Emergency Management Agency (FEMA) National Risk Index score of 83.99 as of September 2025. The risks are manageable with proper facility engineering and disaster recovery planning.

The primary environmental threats to data center operations include:

• Hurricane and Strong Wind Events
• Winter Weather and Ice Storms
• Riverine Flooding
• Heat Waves
• Tornadoes