Microsoft has ponied up millions of dollars to expand its data storage farm in south Fulton County.
The tech giant paid $6 million last month to acquire nearly 21 acres next to its existing Palmetto data center campus, according to county property deeds. Bowen Wallace, Microsoft’s corporate vice president of data centers in the Americas, told The Atlanta Journal-Constitution in a statement that the land purchase will “support data center construction already underway in the area.”
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
Data center developers have described the demand for these facilities as insatiable, and the industry is raising billions of investor and private equity dollars to expand across the country. But their growing prominence across the Peach State has prompted controversy among communities, utilities and lawmakers.
The Georgia House last week approved a bill to suspend lucrative sales tax exemptions for equipment housed in data centers over concerns about pressure these facilities place on power grids. The legislation still needs to pass the state Senate before it goes to Gov. Brian Kemp’s desk.
“This is an immense subsidy for an industry that takes up a tremendous amount of resources, power and water,” Rep. Shaw Blackmon, R-Bonaire, chairman of the House Ways and Means Committee, said before the Feb. 27 vote.
Credit: HYOSUB SHIN / AJC
Credit: HYOSUB SHIN / AJC
Georgia Power, the state’s largest electric utility, is in the process of asking regulators to approve huge amounts of new electricty-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.
Redmond, Washington-based 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.
The recent land sale was first reported by the Atlanta Business Chronicle.
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.
The Palmetto land acquisition comes 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 recently told media outlets he wants Microsoft to soon decide whether to resume it campus plans or allow the city to take it over to build something else.
