Data Center Boom Meets Resistance Across Chicagoland

The data center land grab spreading across Chicagoland is hitting a familiar friction point: local pushback.

From Northwest Indiana to Chicago’s far suburbs, developers are pressing ahead with multibillion-dollar proposals tied to artificial intelligence and cloud computing. But residents are increasingly raising concerns about noise, water use and environmental impact, complicating what has otherwise been one of the region’s fastest-growing real estate sectors.

The Chicago Tribune reported that in Lowell, Indiana, New York-based Sentinel Data Centers is planning a $5 billion project known as Project Shirley, planned for 160 acres in Eagle Creek Township. At a town hall last week, CEO Josh Rabine sought to calm fears about the facility, which would require rezoning from agricultural to light industrial and special exceptions for water usage and noise.

The project is expected to generate more than 2,500 construction jobs and about 250 permanent positions. Rabine said traffic would spike during construction but drop off significantly once the facility is operational. Still, residents pressed for details on long-term impacts, according to the publication, particularly as Lake County enforces a 55-decibel noise cap and developers prepare to seek relief from local rules.

Roughly 40 miles north, another high-profile project is taking shape with a bigger name attached. Google confirmed in a statement that it will operate the $832 million Project Maize data center in Michigan City, a site long shrouded behind LLCs and incentive agreements, according to the outlet. The facility, planned for a former industrial property, has already secured local approvals, including tax abatements and economic revitalization status.

But that project has also drawn scrutiny. Residents have challenged zoning decisions and pushed for greater transparency around site plans. Environmental concerns are mounting as well: A state-issued air permit allows dozens of diesel-fired backup generators, raising alarms among advocacy groups about emissions and public health, according to the publication.

While Northwest Indiana communities are still largely courting data center investment albeit with mounting concerns, municipalities on the Illinois side are starting to hit the brakes.

In Yorkville, a fast-emerging data center hub west of Chicago, a proposed campus from Chicago-based Green Door Capital was withdrawn after failing to win City Council support. The project — part of a growing cluster near Eldamain Road and Route 34 — had already been scaled back, according to the publication, with added setbacks, open space concessions and a $10 million impact fee commitment.

It wasn’t enough to pass muster, however, as city officials pointed to the lack of an end user, proximity to residential neighborhoods and the sheer volume of already-approved projects, including the massive Project Cardinal and other CyrusOne developments nearby in Aurora and elsewhere. An online petition opposing data centers has drawn thousands of signatures, and a resident lawsuit is adding pressure.— Eric Weilbacher