Australian real estate development firm Hickory is moving into the data center space and will build its first facility in Melbourne.
Founded in 1991, Hickory develops commercial, residential, and mixed used buildings across Australia. The company is now planning to build a 36MW facility on a site in Truganina in west Melbourne.
Development on the 3.5-hectare site will start later this year pending development approval from Wyndham City Council, and will have 25,000 square metres of floor space across 12 data halls.
Hickory has a modular construction business, and in 2018 it relocated its building factory to 41-55 Leakes Road, Laverton, West Melbourne. According to the local authority, an AU$9.5 million data center project has been approved just down the road at 148 Leakes Road. Approval was granted early in 2020, and the planning alerts site shows this project is already far advanced, so this may well be simply coincidence.
Director Michael Argyrou of Hickory Data Centres told the Australian Financial Review its first project is a self-funded spec build with no tenant in place – the company expects to invest AU$500 million in the project – but is confident of filling the space quickly. The company said it might look for debt and equity financing in future.
“What we’ve decided to do over the past few years is slowly swim downstream [and] become a joint venture partner with our clients in developments,” said Argyrou. “We’ve been looking for other opportunities where we can become the developer, builder and landowner, and potentially operator of different market segments.”
If the first facility is successfully filled, a second data center adjacent. The company hopes to build, lease and operate hyper-scale data centers for major cloud service providers or eCommerce companies.
Argyrou told the AFR the move into data centers evolved from a partnership with international construction company Mace, which licensed Hickory’s patented prefab construction system and has built data centers throughout Europe.
“Mace has been talking to us over the past five years about data centers, he said. “They’ve got a very, very experienced data center delivery team in their business and we’ve been collaborating for a number of years.”
A number of the Mace data center team members will relocate to Melbourne and be part of the build team, and the two companies are in discussion about expanding the partnership in the data center business both in Australia and New Zealand and across the Asia-Pacific.
The team at the Hickory Data Centres business include CEO Joel O'Halloran, COO Michael Gunton and chief customer officer Michael Veness, all of whom have worked previously at Fujitsu's Australian data center business.