The development of data centers in various communities around the world has been shown to generate significant positive impacts. These range from economic benefits like job creation and increased revenue to social improvements programs focused on underserved communities. Opening a data center can have major positive impact on the community, including job creation, an increase in salary averages, reuse of abandoned properties, beneficial fiscal effects, and social improvements.
One key economic benefit of data centers is job creation, requiring skilled professionals such as IT specialists, engineers, and maintenance staff. Area Development1 reports that data centers can generate hundreds of jobs during construction and dozens to hundreds of permanent roles once operational. These positions offer competitive salaries from $70,000 to over $100,000, with a single skilled technical salary equating to 2-4 traditional warehouse/logistics salaries.
For instance, JLL's Data Center Outlook2 highlights that the average salary for data center jobs is about $80,000 per year, compared to the national median income of approximately $50,000. This substantial difference in earnings not only benefits employees but also stimulates the local economy through increased spending and investment.
Data centers can repurpose existing structures like vacant office buildings or industrial plants, revitalizing areas suffering from urban decay and reducing the need for new construction. This approach is economically and environmentally beneficial, offering a more efficient use of property with lower floor area ratios (FAR), minimal setbacks, fewer parking requirements, and less traffic. According to DataCenterKnowledge2, repurposing abandoned buildings into data centers preserves historical structures and reduces the environmental impact of demolition and new construction. Furthermore, this practice helps mitigate urban sprawl and preserve green spaces.
Data centers distinguish themselves with virtually zero onsite waste and pollution. They bolster their environmental impact by adopting sustainable practices like green building designs and integrating renewable energy sources like wind and solar power. Advanced cooling technologies play a pivotal role in reducing energy consumption and carbon emissions. Furthermore, they implement heat recovery systems to recycle excess heat, benefiting local communities through supplementary heating for facilities such as pools and urban centers.
The fiscal impact of data centers is multifaceted, contributing to local economies through taxes and utility payments, while significantly increasing property values. Data centers' high energy demands boost utility revenue for local governments and drive investments in infrastructure improvements. Personal property taxes on IT equipment, furniture, and other removable assets are a key component of this impact. These taxes are paid annually based on the original purchase price, depreciation, and local tax rates. For example, $200 million in IT equipment for a 5MW data center in suburban Dallas, Texas, could generate approximately $17 million in taxes over five years. Scaling up, a 20MW data center would yield four times that amount—$68 million over five years. Over the typical 40-year lifespan of a data center, this equates to a substantial $544 million in personal property taxes.
A study by Area Development indicates that the fiscal benefits of data centers can surpass those of traditional commercial properties. For example, a data center can generate ten times more revenue per square foot than a standard office building due to higher property values and utility usage.
The establishment of a data center can significantly reduce crime rates and alleviate poverty levels. The introduction of high-paying jobs and the revitalization of neglected areas contribute to fostering a safer and more stable community. As mentioned by JLL, regions hosting newly established data centers have experienced a decrease in crime rates, thanks to the employment opportunities created and the economic revitalization of previously distressed areas. Having the continuous 24/7 security presence provided by data centers further enhances community safety. Also, the increased economic activity and community investment can lead to better-funded social services and support programs for the underserved communities.
Metrobloks is actively working to bring high-performance data centers to urban metro areas, addressing both economic and social challenges for these communities. By leveraging innovative technologies and sustainable practices, Metrobloks aims to repurpose distressed properties, create high-paying jobs, and stimulate local economies. Our focus on sustainability ensures that these developments not only boost economic growth but also preserve the environment, making industrial and commercial urban areas more resilient and vibrant.
Opening a data center in a community can bring significant positive effects, such as creating high-paying jobs, rejuvenating abandoned properties, boosting fiscal revenue, and boosting local communities. However, to maximize the positive impact Data Center developers need to work closely with local governments and communities to implement appropriate land use policies and streamline the permitting process to facilitate this development and best align the interest of the Data Center developers and communities.
As an industry we must improve community engagement efforts to effectively communicate the advantages of having a data center in their neighborhoods. Understanding and addressing these factors can empower communities to maximize the potential benefits of data centers for promoting both economic growth and social well-being.
1. Area Development. "The Impact of Data Center Development on Local Communities." https://www.areadevelopment.com/data-centers/data-centers-q1-2015/impact-of-data-center-development-locally-2262766.shtml
2. JLL. "Data Center Outlook." https://www.us.jll.com/en/trends-and-insights/research/data-center-outlook
3. DataCenterKnowledge. "Data Center Trends and Predictions for 2024 From Industry Insiders." https://www.datacenterknowledge.com/management/data-center-trends-and-predictions-for-2024-from-industry-insiders
4. DataCenterHawk. "2024 Global Data Center Predictions." https://datacenterhawk.com/resources/hawkpodcast/2024-global-data-center-predictions
