Here are some great posts about reclaiming unused space in esxi.

WHAT’S NEW IN ESXI 6.5 STORAGE PART I: UNMAP

IN-GUEST UNMAP FIX IN ESXI 6.5 PART I: WINDOWS

IN-GUEST UNMAP, ENABLEBLOCKDELETE AND VMFS-6

To get automatic space reclamation you’ll need:

  • ESXi 6.5 Update 1
  • iSCSI volume formatted with VMFS6. (I think VMFS5 works but there are caveats.)
  • Thin provisioned disks.
  • Discard option enabled on mount points for your Linux guests.

My new esxi 6.5 host connecting to an iscsi volume on FreeNAS 11.0 works like a charm at least when I force and UNMAP with sudo fstrim /

I haven’t had it enabled long enough to watch it work it’s magic, but apparently this means no more filling the drive with zeros, then punching a hole while the machine is offline.

UPDATE 2018-01-20: The magic happens immediately. You can see the updated datastore size immediately after deleting a large file in a linux VM.

It also means that as much as I hate setting up iSCSI I’m not going to go back to NFS if it doesn’t have this.