Zayo Group (news, filings) said yesterday that it has begun construction of a metro fiber ring in the central business district of Los Angeles that will provide data center connectivity for CoreSite (NYSE:COR, news, filings). CoreSite has two existing data centers in Southern California totaling 600,000 square feet, with a third on the way that will add another 25,000 square feet of an eventual 145,000 when it opens later this quarter.
As I recall, Zayo's existing LA fiber comes from the Fibernet Telecom Group acquisition, and was perhaps the smallest 'starter set' in their portfolio, just a ring in the area of CoreSite's One Wilshire. The company has extraordinarily detailed public maps, on which we can see that the new planned high fiber count buildout appears to aim at the 900 N.Alameda facility.
No doubt Zayo will be putting more money into the Los Angeles market in the future, as they are aiming to expand their depth across all their metro markets. In the last two quarters, they have spent a higher percentage of revenue on capex than any company for whom I have data, in the neighborhood of 40% which has lately edged out AboveNet.
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