In my experience, co-lo is the way to go for ColdFusion installations, simply due to the inexperience of many sysadmins in dealing with CF Admin and all the minor performance tweaks that we tend to become familiar with over time. One downside of co-lo, however, can sometimes be physical access. In my last co-lo situation, the facility was about 10 blocks from our office and we had 24/7 access, so it was no big deal when those situations arose where we really did want direct access to a CF or SQL box or the firewall or the tape drive or whatever. So, if the hosting company can truly demonstrate the ability to help you tune your app / DB performance issues and/or can at least take direction when you say "please increase the 'Limit connections to' number for my datasource in CF Admin", then managed hosting may be great. Since you co-lo now, I'm guessing that physical access is acceptable at any rate, so that's probably a non-issue.
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