Microsoft made another huge land buy in metro Atlanta for yet another data center complex, its latest investment in the region.
Though the Redmon, Washington-based company’s mixed-use corporate campus on Atlanta’s Westside remains on hold, Microsoft has quickly gobbled up industrial land south of Atlanta to try to feed its insatiable need for more data center space.
The tech giant paid $52.5 million to acquire about 136 acres near South Fulton Parkway, according to county property deeds. The land is close to the company’s existing Palmetto data center campus and planned data storage farm in East Point. Microsoft paid $6 million in February to add 21 acres to its south Fulton County land holdings.
The land sale, which took place in early April, was first reported by the Atlanta Business Chronicle. A Microsoft spokesperson told The Atlanta Journal-Constitution the latest property acquisition will support data center construction that is already underway in the south Atlanta region. The company declined to comment further.
These sprawling facilities consist of warehouses filled with rows of computer servers that power our online lives, from storing files to artificial intelligence systems. They’ve become one of the hottest uses for undeveloped real estate in metro Atlanta, with roughly 20 gigantic data center campuses are either in development or preparing for sizable expansions across Georgia, mostly near Atlanta.
Since 2023, data center construction in metro Atlanta has increased 211%, which is the fastest among major data center markets across the country, according to data from real estate services firm CBRE. The rapid growth of the data center sector has prompted pushback from local communities and lawmakers, who question the large amount of taxpayer incentives often leveraged to woo them to the Peach State.
The server farms are also massive electricity and water hogs.
Last month, Georgia’s legislature approved a bill to suspend sales tax breaks on new data centers over concerns that taxpayers aren’t getting much financial return from the multimillion-dollar incentive program. House Bill 1192, which faced intense pushback and lobbying efforts from data center companies, is now before Gov. Brian Kemp for his consideration.
Kemp has until May 24 to sign or veto the bill.
The legislation was prompted, in part, by Georgia Power asking regulators to approve huge amounts of new electricity-generating capacity — mostly powered by fossil fuels — mainly due to the vast number of data center projects across the state. Georgia Power executives have said data centers are responsible for roughly 80% of the demand crunch it claims to be facing.
The Georgia Public Service Commission voted Tuesday to greenlight most of the fleet additions Georgia Power requested.
The approved deal calls for the company to use extra revenue it expects to earn from serving data centers to lower the bills paid by residential customers, who have a faced a cascade of rate hikes since late 2022. But consumer advocates say the protections against further rate increases are flimsy and warn the modest reductions may never materialize.
Microsoft previously told the AJC that incentives are an important factor it considers when planning new facilities. However, tax breaks are just one of 35 criteria the company takes into account, a company spokesperson said.
Microsoft’s Palmetto data center campus was approved in November 2020, receiving a $14.5 million property tax break from the Development Authority of Fulton County. The project’s value was estimated at $420 million and included 250,000 square feet of data center space.
According to previous filings with the Georgia Department of Community Affairs, Microsoft expects the project could span to up to 116 acres by 2028. Microsoft also has ongoing data center projects in East Point and Douglas County.
Credit: Hyosub.Shin@ajc.com
Credit: Hyosub.Shin@ajc.com
The recent land acquisitions come amid growing pressure for Microsoft to detail its next steps for its 90-acre site in Atlanta’s Grove Park neighborhood, where the company originally planned to build a sprawling office campus and mixed-use development before halting those plans a year ago.
Mayor Andre Dickens told media outlets in February he wants Microsoft to soon decide whether to resume it campus plans or allow the city to take it over to build something else.
-Staff writer Drew Kann contributed to this report.
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