“It was certainly part of our consideration,” Rachel Peterson, Facebook’s vice president of data center strategy, said of the incentives. She said the company has not yet applied for any incentives. “Illinois has been on our list of selected states for a while. DeKalb’s location was at the top of that list.”
Facebook is among the tech giants, including Apple, Microsoft and Google, which have built more than $ 1 billion “server farms” in Iowa, which has cheap energy and aggressive incentive programs.
Such “hyper-scale” users are highly coveted, but have remained elusive for Illinois. The state incentive program “was a great component in bringing this project to the goal,” says Jerry Krusinski, CEO of Krusinski Construction in Oak Brook, who has been hoping to land a data center since he started working at the 1,000-acre ChicagoWest . Business center at DeKalb more than a decade ago.
The Facebook facility will be at the ChicagoWest hub, and the Krusinki firm is doing the infrastructure for the park and the project. It is close to Interstate 88, which has a major fiber optic link that goes with it.
“We responded to many requests for proposals over the years,” Krusinski said. “In 2013, we were selected for one. Like many others, the project landed in Iowa.”
Due to its size and geography, Chicago has been one of the nation’s telecommunications hubs. It is the fourth largest data center market in the country, but it is a quarter the size of the leader, Northern Virginia, according to CBRE data.
Lately, Chicago has not grown as fast as its peers. Since late 2017, Northern Virginia data center capacity has grown 77 percent, CBRE data shows. Dallas overtook Silicon Valley, moving to No. 2, increasing capacity by a third. Silicon Valley grew 27 percent, while Chicago grew just 18 percent.
The Illinois Department of Commerce and Economic Opportunity says seven companies have been approved for data center tax incentives. Among them are data center companies Stack Infrastructure and CoreSight, which are building projects in the Chicago area. A key part of the program is a sales exemption and some other taxes for projects with capital investments of $ 250 million or more.
While the data centers the size Facebook is planning can cost anywhere from $ 200 to $ 300 million, the team inside them can cost three times as much. That equipment is updated or replaced approximately every four years.
“Tax incentives are a big problem for data centers,” said Bob Heiderscheidt, CEO of MDI Access at Alsip, which designs and builds data centers. “That was always a disadvantage for Illinois. There had to be an urgent need to come here. Usually it comes down to energy, fiber and money. (Facebook) could put it anywhere. ”
Most of the jobs created by data center projects are under construction. Facebook estimates that construction will result in hundreds of jobs. Data center operations will generate around 100 jobs.
The Facebook facility is expected to open in 2022. At over 900,000 square feet, it will be almost as large as the 1.1 million square foot Digital Realty facility at 350 E. Cermak Road, which is one of the data centers. largest in the world But it has multiple clients.
Facebook says a key part of its decision was the availability of renewable energy. The company is committed to offsetting the energy use of its data centers by adding energy from renewable sources to the power grid. “We were looking for a shovel-ready site. . . and a strong pool of talent for construction and operations, “Peterson said.
