Orwick will discuss strategies for negotiating data center leases at the Data Center World conference in National Harbor, Maryland, in September. His plan is to explain why it`s important for IT organizations to not only represent exactly what happens when service levels aren`t met, but also, just as importantly, what happens when the IT organization needs to exit the lease. Since no two data centers are the same, the owner usually has an advantage in setting not only general terms and conditions, but also exclusions that the IT organization might overlook. That`s why IT organizations need to be particularly attentive to the wording that surrounds each condition. Ultimately, the choice between an entire sales/colocation structure and a purely managed hosting structure is to reconcile the need to control servers and IT equipment with the desire to achieve the best possible savings by entering into a data center lease agreement. The important issues that need to be addressed before such a decision are: the parties have to face reality when building a data center. According to kpMG International`s 2015 Global Construction Project Owner`s Survey, it`s also important for IT organizations to make sure they have the right team to not only negotiate the contract, but also draw the IT organization`s attention to any incentives that might exist at a given location for delivering applications, he said. Finally, some of the benefits that could result from public funds for a data center operator should be passed on to the customer who agrees to use that data center facility. A data center service provider may want to limit its risk in the event of a server failure and, instead, insert a remedy for the end user in the form of “lease credits” (a “lease” credit paid under a co-location agreement) or service credits (a service fee credit sometimes paid under a separate service level agreement (SLA).
As a rule, such an SLA will be next to the co-location agreement for the same duration. It deals with the performance quality of the data center and usually guarantees the level of performance. Over the past three years, data center utilization has increased by an average of more than 20% worldwide. This evolution will continue in the coming years at least until 2021. (Source: CISCO) One of the hottest but least understood types of real estate is the data center. Data centers house servers and computing devices that allow you to use your computer at work and stream a movie on Netflix, 24 hours a day, 7 days a week. The demand for data centers is growing and will continue to increase for the foreseeable future. Depending on the target user of a data center, it can be located in a rural environment or right next to a trading exchange in a large city. Hogan Lovells is your first point of contact and the leading provider of legal services in terms of successful realization and investment in data centers in Germany and Europe.
A limitation of liability can be beneficial for both parties. The agreement should also include provisions on data protection, security (e.g.B. Access to the building) and compliance with the laws. Since the rental agreement is the main legal document governing the relationship between the parties, particular caution should be exercised when negotiating “Provider Must Haves”, on the one hand, and “Customer Must Haves”, on the other. Among the most important topics to consider in lease agreements, our data center team is made up of lawyers with a deep understanding of the data center industry and its particularities. In closely coordinated advice from a head office, we gather our knowledge from a variety of legal disciplines, including real estate, infrastructure, energy, resources & projects, intellectual property, M&A, data security, dispute resolution, society, trade, project finance, labor law, and tax law. . . .