A group of Kenyan investors under the trade name Icolo.io is building a Sh850 million data centre in Nairobi. The construction commenced last month and is set to be completed by the end of 2017. The data centre will be situated on land leased from Catholic University of Eastern Africa, and will span 27,000 square feet.

“The data centre will be built in two phases,” icolo.io Chief Executive Officer Ranjith Cherickel said yesterday during a media briefing. “The first phase will have a capacity of 42 racks, while the second will have 240,” he added.

This is the second centre after the firm last year broke ground in Mombasa in 2015, where it started the construction of another data centre worth Sh600 million. The Mombasa data centre is set to be completed by May 2017.

Mr Cherickel said already, 40 companies have shown interest in taking space at the data centre once it is complete.

“We already have three companies that have confirmed their interest and we will be negotiating three to five year contracts with them,” Cherickel said. “These companies are Aryaka, a company known for offering cloud caching solution, Node Africa, and a local bank that I cannot name due to confidentiality,” he added.

In Mombasa, the icolo.io boss said they were targeting about 30 companies, but they have not registered any interests yet. He said that the Mombasa data centre has a capacity of 226 racks.

Cherieckel explained that the reason his company was not interested in purchasing land for the construction of the data centres, was because the Kenyan land purchase system was filled with loopholes that made acquisition expensive and prone to court cases that could delay the project.

“We have preferred to lease land for construction because we are an SME with little capital. Purchasing land in Kenya is expensive and you could face court cases that could stall your project,” Cherieckel averred.

The CEO also said that icolo.io was especially targeting major banks in the country that found it difficult and expensive to construct their own data centres and preferred to outsource.