CloudHQ plans to build a $1 billion data center in Chaska, the fourth such facility in the West Creek Corporate Center.
$1 billion, 1.4 million-square-foot data center planned for Chaska
CloudHQ is projected to provide local jurisdictions hundreds of millions of dollars in tax revenue over the lifecycle of the building, according to the plans submitted to the city.
August 26, 2022 at 9:02PM
If fully approved, it would be among the larger construction projects in the Twin Cities. Once opened, it would create 75 to 100 technical jobs.
Data centers contain thousands of computer servers that provide internet capacity for cloud computing service providers and oftentimes public use.
They do not create as many jobs as manufacturers or utility plants per square foot, but the jobs are usually highly paid. This year, the three existing data centers at West Creek will yield $1.3 million in property taxes for the city, according to Chaska officials.
The Chaska City Council earlier this month approved the concept plan for Washington, D.C.-based CloudHQ, which builds and operates centers for corporate customers. The center would be 1.4 million square feet, with a 180,000-square-foot story on top, according to city documents.
By comparison, the current largest data center in the West Creek business park, located north of Engler Boulevard and west of Clover Ridge Drive in Chaska, is a 250,000-square-foot data center used by UnitedHealth Group that opened in 2012. The estimated value for that building is $24.4 million. The other two centers, used by Stream Data, are 115,000 square feet.
Construction of CloudHQ's data center is expected to begin in 2023. CloudHQ's investment in the project will exceed $1 billion, per a document submitted to the city by planning and engineering construction firm Kimley-Horn.
CloudHQ's center would take up to two and a half years to complete, and it would require 1,000 construction workers to build, documents show.
A new, already planned 300-megawatt electricity substation will be needed to power the center and improve the existing grid. The substation will likely be placed on land that Xcel Energy is working to acquire, per Kimley-Horn. Once the land is acquired, Xcel will need to get the substation project approved by officials, setting up construction for 2023 and delivery in late 2024.
For perspective, so far this year, electrical usage in Chaska peaked at 86 megawatts in June, and the electrical capacity for the two data centers occupied by Stream are a combined 12 megawatts, per the city.
In the past five years, CloudHQ has built and leased 2.4 million square feet of data center real estate requiring 320 megawatts of load power. Earlier this week, the company broke ground on a $2.5 billion, 1.5 million-square-foot data center in Mount Prospect, Ill.
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