Microsoft spent $41.5 million on a 30-acre speculative industrial site in Hoffman Estates to expand its Chicagoland data center operation.
The Redmond, Washington-based tech giant bought the site from an LLC that shares an address with Elmhurst-based Prairie Ridge Development Group in a deal executed on Feb. 10 and recorded on March 3, according to Cook County public records.
A representative for Microsoft did not respond to questions about the acquisition and its plans for the property.
The acquisition is adjacent to the 53-acre site where Microsoft plans to build two 207,000-square-foot data centers, both of which have been approved by the village and one that is under construction, according to the Daily Herald. Hoffman Estates village officials reportedly haven’t received specific proposals for the land’s use.
Microsoft’s latest purchase appears to include a 250,000-square-foot industrial property built by Prairie Ridge in partnership with Oak Brook-based Yampa Investments, according to the developer’s website. Prairie Ridge completed shell construction on the property in January 2022. The developer did not respond to a request for comment.
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The Chicago-area market for data centers — facilities that house back-end IT systems such as mainframes, servers and databases for companies — tightened in 2022, according to a mid-year report from JLL. The August report, the most recent analysis available from the brokerage, predicted pricing for the centers to spike in 2023 due to much of the data center space across the suburbs already being spoken for, but to even out in 2024 with several projects being delivered, per JLL.
Facebook parent Meta put $1 billion into more than doubling the size of a data center in DeKalb to 2.4 million square feet back in April, and another $1 billion project from Prime Data Center also got underway in Elk Grove Village around the same time. In the city, Metro Edge Development Partners plans to build a data center on a two-acre parcel in the Illinois Medical District, the firm announced during the fall.