New details revealed about Microsoft’s $1.8 billion data center near Atlanta

Data centers are effectively giant warehouses filled with computer servers that store data online and power technologies like artificial intelligence. They have become one of the most popular uses of undeveloped land in metro Atlanta, raising concerns about their energy consumption, water usage and prevalence.

Since 2023, data center construction in metro Atlanta has grown 211%, the fastest rate among major data center markets in the country, according to real estate services firm CBRE. Microsoft has targeted Atlanta’s Southside for data center development, paying at least $171 million so far this year to acquire more than 480 acres, including the Union City site.

The Union City project is being built by other companies, but the end user will be tech giant Microsoft, the company previously confirmed to the Atlanta Journal-Constitution.

The project was revealed to the public last month when one of the project’s developers, EdgeConneX, received a $75 million, 10-year tax abatement from the Fulton County Development Authority. The controversial abatement will help cover topography issues and taxes on the site’s electricity consumption. An EdgeConneX adviser also told the DAFC board that it would level the playing field with three other sites under consideration.

Credits: Microsoft

Credits: Microsoft

Texas-based engineering firm Burr Computer Environments was listed in the DRI as the developer and will partner with EdgeConneX and Boston-based real estate investment management firm TA Realty to deliver the project for Microsoft.

The companies said in a press release Tuesday that the data center will have 324 megawatts of capacity, making it among the largest such projects in the Southeast. As of the end of June 2022, the entire Atlanta data center market had 271 megawatts of inventory, according to CBRE.

The statement said the campus is “prepared to meet the growing demand for high-performance computing required by AI, cloud services and other emerging technologies in the Atlanta market.”

Headquartered in Redmond, Washington, Microsoft reported revenue of $212 billion and net income of $72.4 billion in fiscal 2023, ranking 13th on the latest Fortune 500 list. The company operates hundreds of data centers around the world, including several in Fulton. In 2020, the DAFC voted to provide Microsoft with tax breaks totaling about $32 million for a pair of data centers in the county.

The DAFC estimates that local governments will collect $198 million in taxes from the Union City project over the next decade, despite the tax break. The DAFC collects fees on the tax break deals it approves that fund its budget.

The first phase of the project is expected to open in 2026, with further phases expected to come online by 2032.

Credit: Courtesy of Fulton County Development Authority

Credit: Courtesy of Fulton County Development Authority