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Data Centers in Dallas

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Dallas – Central Hub for US-Wide Low Latency

Dallas stands as one of the most important data center markets in the United States, offering a powerful combination of central location, dense connectivity, and competitive operating costs. It is an essential hub for any business requiring low-latency access to both East and West Coast markets from a single, resilient location. This market ensures workloads can reach the majority of the US population efficiently, safeguarding revenue and user experience.

Dallas: At A Glance

FactorRating / DataNotes
Global Connectivity GradeA+Top-tier US market with extensive long-haul fiber and carrier diversity.
Direct Cloud On-RampsOver 11 – as of September 2025AWS, Azure, Google Cloud (GCP), IBM, Oracle.
Power Cost$0.07 - $0.09/kWh (est.)Driven by a diverse energy mix, including significant renewables and natural gas.
Disaster RiskModerate (43.46 Score) – as of September 2025Primary risks are weather-related; low exposure to major seismic or hurricane events.
Tax IncentivesYesState sales and use tax exemptions are available for qualified data centers.
Sales Tax6.25% (Texas State) – as of September 2025Local taxes may apply in addition to the statewide rate.

Network & Connectivity Ecosystem

Dallas is a primary North American network hub, serving as a major intersection for data traffic moving across the continent. Its central location minimizes latency nationwide.

Carrier Density & Carrier Neutrality: The market features over 77 unique network providers, as of September 2025. This high density is concentrated in carrier-neutral facilities, particularly around the downtown Dallas Infomart, offering extensive choice for colocation and interconnection.

Direct Cloud On-Ramps: With over 11 dedicated cloud on-ramps, Dallas provides direct, private connections to all major hyperscalers, as of September 2025. Available providers include AWS, Google Cloud (GCP), Microsoft Azure, IBM Cloud, and Oracle Cloud, enabling access to 17 cloud regions.

Internet Exchange Points (IXPs): The region is anchored by major exchanges like DE-CIX Dallas, one of the largest neutral IXPs in the country. These exchanges facilitate efficient, low-cost traffic peering between networks, improving performance and reducing transit costs.

Bare Metal: Bare metal server options are readily available from numerous providers. Companies like Hivelocity and phoenixNAP offer dedicated server solutions for workloads requiring direct hardware access.

Power Analysis

The Dallas-Fort Worth area provides reliable and competitively priced power, a critical factor for large-scale data center operations.

Average Cost Of Power: Industrial electricity rates are estimated to be between $0.07 and $0.09 per kWh, as of September 2025. This competitive pricing, supported by Texas's diverse energy generation, helps control a significant operational expense for compute-heavy deployments.

Power Grid Reliability: The power grid, managed by ERCOT, is well-engineered to support critical facilities. Major data center clusters are fed by redundant substations, providing the high levels of uptime required for mission-critical infrastructure.

Market Access, Business & Tax Climate

Dallas offers a favorable business environment with direct access to a large and growing economic region.

Proximity To Key Business Districts: Data centers are strategically located near major business districts, including the Telecom Corridor in Richardson and the corporate hubs in Plano and Las Colinas. This proximity serves the area's high concentration of finance, healthcare, and technology companies.

Regional Market Reach: From Dallas, network traffic can reach over 80% of the US population in under 25 milliseconds. This makes it an ideal location for content delivery, cloud services, and disaster recovery sites serving the central and southern United States.

Tax Advantage For Data Centers: Texas provides significant tax incentives for data center operators and tenants. A state sales and use tax exemption on equipment and electricity lowers both the initial capital investment and ongoing operational costs.

Natural Disaster Risk

Dallas has a moderate natural disaster risk profile, with a FEMA National Risk Index score of 43.46 out of 100, as of September 2025. The area is not prone to major earthquakes or direct hurricane landfalls.

Primary environmental risks are atmospheric and weather-related, including:

  • Tornadoes
  • Hail
  • Severe Winter Weather
  • Drought & Heatwave
  • Lightning
  • River Flooding
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