Microsoft Continues Aggressive Land Grab in Metro Atlanta for Data Center Development

These sprawling facilities house computer files, cloud networks and other digital artifacts of our online lives, and the emergence of artificial intelligence has caused demand for additional space to explode. The Redmond, Washington-based company is trying to get ahead of its competitors by developing giant data centers across the country. Microsoft is reportedly developing the world’s most expensive data center through a partnership with OpenAI, the company behind ChatGPT. The location of the $100 billion project has not been disclosed.

“In recent years, we have seen a substantial increase in cloud and AI services,” a Microsoft spokesperson said. “Every industry is undergoing technological change and it takes infrastructure like data centers to pave the way for the next generation of cloud capabilities. »

The Atlanta metro area has become a hotbed of data center activity. Since 2023, data center construction in metro Atlanta has increased 211%, the fastest among the nation’s major data center markets, according to data from real estate services firm CBRE.

Even as the prestige of Atlanta’s data centers has increased, it has also generated controversy over the benefits – or lack thereof – of the industry.

Veritable giant warehouses containing billions of dollars of computer equipment, data centers employ only a handful of workers despite their gigantic size. They also put pressure on local utilities because of the huge amounts of electricity and water they consume. State regulators last month allowed Georgia Power to expand its electricity generation capacity — mostly powered by fossil fuels — primarily because of the large number of data center projects under construction or in the pipeline throughout the state.

According to a Bloomberg report, Microsoft’s AI efforts threaten the company’s commitment to be carbon neutral by 2030. Microsoft’s carbon emissions today are about 30% higher than in 2020, according to a sustainability report released Wednesday.

The company’s latest land purchase took place along Georgia 74 and closed on April 30. The Atlanta Business Chronicle was first to report on the transaction and link the development to “Project Rita”, a massive 1.5 million square foot “technology-enabled” development primarily in Fayette County. Few details about the $350 million project were first disclosed in November, and neither the project’s developer nor its intended use have been disclosed.

Credit: Google Earth

Credit: Google Earth

Data centers can generate significant property tax revenue for local communities, although some of these benefits are reduced by tax incentives offered by state and local leaders.

Microsoft operates a data center campus in Palmetto, a project that received a $14.5 million property tax break from the Development Authority of Fulton County. The company also has data centers planned in East Point and Douglas County.

This year, state lawmakers passed a suspension of the sales tax relief program for some large data centers. The bill’s sponsors said the incentive program didn’t give the state much return on its multimillion-dollar investment. But Gov. Brian Kemp vetoed the measure earlier this month, saying a suspension would be abrupt, especially since the state Legislature extended the program two years ago through 2031.

Microsoft’s recent land acquisitions come amid growing pressure for the company to detail next steps for its 90-acre site in Atlanta’s Grove Park neighborhood, where the company had originally planned to build a campus of sprawling offices and a mixed-use development before shutting down those projects a year later. There is.

Mayor Andre Dickens said in February that he wanted Microsoft to decide quickly whether to resume its campus plans or allow the city to take it back to build something else. The company declined to provide an update on its plans for the property.