Elk Grove Village to get $1B data center project

A San Francisco-based firm plans to break into the Illinois market with a $1 billion data center project to build a trio of three-story buildings totalling 750,000 square feet in Elk Grove Village, already home to 11 data centers.

The Elk Grove Village board signed a purchase and redevelopment agreement with Prime and the municipality voted to sell up to six parcels to Prime for an estimated $30 million, according to the Daily Herald. The Prime project will total 150 megawatts when completed. Data centers, essentially large warehouses filled with computing and data storage systems, are measured in power instead of square footage.

Elk Grove owns two parcels where the former Elk Grove Hotel was located, at 1600 Oakton Street, and other office buildings at 1550 East Higgins Road. Prime plans to pay Elk Grove $21.3 million once the village acquires two more properties — an office building complex at 1500 East Higgins Road and a retail strip building at 1700 Oakton Street.

The project needs final approval from the board, which is scheduled for December. When the project is approved, it will be the third major data center announced in Elk Grove since last year. Microsoft started constructing a $123 million data center on 37 acres of land in the village and T5 Data Centers acquired a 164,000-square-foot building for $29 million in the Elk Grove Technology Park last year.

New technologies, streaming and remote work have been driving ttps://therealdeal.com/chicago/2021/03/18/data-center-demand-and-rent-surges-in-secondary-markets/ across the country. Data center construction reached a record last year and it’s nearly as strong this year, according to real estate firm JLL. In Chicago, the amount of new data center capacity under construction is up 42 percent to about 18.5 megawatts in the first half of 2021 from the same period last year, JLL said.

[Daily Herald] — Connie Kim