{"id":182676,"date":"2025-04-13T11:20:02","date_gmt":"2025-04-13T11:20:02","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/real-estate\/navigating-current-power-challenges-and-future-demands-market-share\/"},"modified":"2025-04-13T11:20:02","modified_gmt":"2025-04-13T11:20:02","slug":"navigating-current-power-challenges-and-future-demands-market-share","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=182676","title":{"rendered":"Navigating Current Power Challenges and Future Demands \u2013 Market Share"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div>\n<p>By Kelly Hartog<\/p>\n<p>It\u2019s an exciting time in the commercial real estate industry with overall data center growth showing a greater demand for power capacity, crypto, mining and automation, according to David Hickey, global managing director with Hickey &amp; Associates.<\/p>\n<p>Hickey moderated a panel on the critical need for power in industrial development at NAIOP\u2019s I.CON West conference this week in Los Angeles. \u00a0<\/p>\n<p>\u201cWe\u2019re looking at this on not just a continued flow, but on an increased exponential level, much of it driven by hyper-scalers and the data center demand,\u201d he said, noting that power grids in the U.S. face significant challenges, including seasonal effects, aging infrastructure, transmission problems and scheduling difficulties, all occurring amidst budget constraints. \u201cThat\u2019s why our job is really to figure out what are those tradeoffs for a business to find that ultimate location.\u201d<\/p>\n<p>While there are a variety of factors in choosing that location including labor, taxes, costs, and supply chain logistics, Hickey focused on the real estate itself \u2013 the availability of land and sites, and the opportunity for those sites to obtain and sustain power today and in the future. He explained that supply chain issues, beginning during the COVID-19 pandemic and continuing to the present, hinder this.<\/p>\n<p>Justin Smith, senior vice president for Lee &amp; Associates, said that as a real estate broker, he\u2019s navigating his clients through power constraints. He shared the example of an automotive manufacturer his firm is currently working with in Southern California\u2019s Inland Empire.<\/p>\n<p>\u201cAnytime you have the real estate process, you have where you are and what you have left on your obligation and your contract and then trying to line up the property,\u201d he said. \u201cSo, with auto manufacturing, you have all the phasing parts of moving in and that\u2019s even ramping up as you think of what a power upgrade looks like and how it fits in with the manufacturer trying to phase in an operation. It adds a lot of complexity and then there\u2019s a lot less to choose from, which makes every step [critical].\u201d<\/p>\n<p>Speaking from the construction development perspective, Brad Heitland, vice president at Mortenson Properties, noted that while the company is a commercial contractor, it has diversified into renewables. \u201cAbout 40% of our business is renewables. We\u2019re going to be across wind, solar, and storage high-voltage infrastructure, so we\u2019re playing a role in creating the new generation to meet the needs,\u201d he said.<\/p>\n<p>He added that approximately a third of the company\u2019s business is through data centers, \u201cso on the other side we\u2019ve got the large industrial users that are saying, \u2018Hey, we need this power. Help us find it.\u2019\u201d<\/p>\n<p>Utilities are used to their integrated resource processes, Heitland added, \u201cwhere they assess what\u2019s the new load, what\u2019s our current generation, what\u2019s retiring. We run an RFP to bring on new generation, which oftentimes takes many years, but in the arms race that is artificial intelligence, the folks aren\u2019t waiting years as people want to move manufacturing in the U.S. as a result of the CHIPS act and Inflation Reduction Act.\u201d<\/p>\n<p>As such, Heitland said they\u2019re having to come up with innovative ways to solve this power challenge by going to the government \u2013 whether it\u2019s state or local utilities \u2013 that are willing to think outside the box to change the status quo on how they\u2019ve been doing business for the last 50 years.<\/p>\n<p>Michael Martella, senior economic development project manager for the town of Gilbert, Arizona, addressed some issues faced in suburban markets in the southeast valley of the Phoenix metro area. \u201cThe requests are obviously large and demanding,\u201d he shared. \u201cWe are consistently working really closely with our utility providers, and I think you really have to focus on that.\u201d<\/p>\n<p>He added if companies looking at potential sites have a specific user in mind it\u2019s worth reaching out, because \u201cwe can give you hopefully some better timelines and better cost estimates early on. Trying to have those conversations as soon as possible is really important for the developments within the state.\u201d<\/p>\n<p>He added, \u201cOur utility providers are really looking at ways to diversify and grow our grid and their plans looking out to 2035. They\u2019re anticipating to almost double capacity.\u201d<\/p>\n<p>Companies are identifying additional creative solutions. Mortenson, for example, is deploying battery storage and microgrids, among other things. \u201cBasically, giga-scale microgrids are being developed and deployed now where you\u2019ve got a combination of solar with wind, high volume of energy storage and on-site natural gas to provide gigawatt continuous loads to meet the power needs for the end user,\u201d Heitland said.<\/p>\n<p>Looking to the future, Martella said, \u201cIt\u2019s important to think outside the box. Challenge the status quo. It\u2019s going to take a different way of delivering to meet the needs of the country over the next five years.\u201d<\/p>\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n<div class=\"wp-block-image\">\n<figure class=\"alignleft is-resized\"><a href=\"http:\/\/blog.naiop.org\/wp-content\/uploads\/2015\/10\/JLL-logo-300px.jpg\"><img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"133\" src=\"https:\/\/blog.naiop.org\/wp-content\/uploads\/2015\/10\/JLL-logo-300px-300x133.jpg\" alt=\"JLL logo\" class=\"wp-image-948\" style=\"width:204px;height:auto\"\/><\/a><\/figure>\n<\/div>\n<p><em><em>This post is brought to you by JLL, the social media and conference blog sponsor of NAIOP\u2019s <a href=\"https:\/\/www.naiop.org\/events-and-sponsorship\/corporate-events-list\/conferences\/2025-icon-west-the-industrial-conference\/\" target=\"_blank\" rel=\"noreferrer noopener\">I.CON West 2025<\/a>. Learn more about JLL at <a href=\"http:\/\/www.us.jll.com\" target=\"_blank\" rel=\"noreferrer noopener\">www.us.jll.com<\/a> or <a href=\"http:\/\/www.jll.ca\" target=\"_blank\" rel=\"noreferrer noopener\">www.jll.ca<\/a>.<\/em><\/em><\/p>\n<\/p><\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>By Kelly Hartog It\u2019s an exciting time in the commercial real estate industry with overall data center growth showing a greater demand for power capacity, crypto, mining and automation, according to David Hickey, global managing director with Hickey &amp; Associates. Hickey moderated a panel on the critical need for power in industrial development at NAIOP\u2019s [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":182677,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[99],"tags":[11117,11089,35192,2481,11209,10977,1783,11198],"dealstore":[],"offerexpiration":[],"class_list":["post-182676","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate","tag-challenges","tag-current","tag-demands","tag-future","tag-market","tag-navigating","tag-power","tag-share"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Navigating Current Power Challenges and Future Demands \u2013 Market Share - Som2ny Network<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fivemor.com\/?p=182676\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Navigating Current Power Challenges and Future Demands \u2013 Market Share - Som2ny Network\" \/>\n<meta property=\"og:description\" content=\"By Kelly Hartog It\u2019s an exciting time in the commercial real estate industry with overall data center growth showing a greater demand for power capacity, crypto, mining and automation, according to David Hickey, global managing director with Hickey &amp; Associates. 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