According to research by Magnum Economics, data center incentives in Illinois have rejuvenated the Chicago-area cloud ecosystem, helping the state attract more than $4.2 billion in new investment. The incentives helped Illinois attract 13 data center projects, which have created more than 8,000 jobs for construction workers. Newly announced projects are poised to bring an additional $4.3 billion in investment into the Greater Chicago market, which includes clusters of data centers downtown and in the suburbs near O’Hare Airport.
The study points to the impact of a 2019 tax incentive plan designed to jump-start data center development in Illinois, which had stalled as projects shifted to other states. Data center projects now receive exemptions from state and local sales taxes on data center equipment for 10 years, if they invest a minimum of $250 million in the facility and create 20 high-paid full-time jobs.
Chicago is home to a top five data center in the U.S. Digital Realty’s 350 Cermak Road Data Center is regarded as the premier mission-critical interconnection, multi-tenant colocation, and telecommunications facility in the Midwest. Originally constructed as a printing press in 1912, 350 Cermak was retrofitted to become one of the largest data centers in the world. It features 1.1 million square feet of data center space and more than 109 megawatts of mission-critical power infrastructure. The carrier-neutral data center features 95-plus enterprise customers, 25-plus cloud service providers, 10-plus contest providers, 35-plus IT providers, and 90-plus network service providers.
Data centers are booming in the Chicago suburbs. Facebook parent Meta is doubling down on DeKalb, home of Northern Illinois University. The tech firm is spending $1 billion to more than double the size of a data center under construction, taking it to 2.4 million square feet. The five-building complex is slated to create 200 jobs and is Facebook’s 17th data center across the U.S.
“Meta’s investment into DeKalb underscores how Illinois can attract business development the right way,” stated Rep. Jeff Keicher (R-Sycamore). “At a time of so much economic uncertainty and rising inflation, the right tax incentives can help turn things around. The creation and retention of good paying jobs is critical to Illinois’ future economic growth and stability.”
Construction began last year at the site of the former United Airlines headquarters in Mount Prospect, clearing the way for the creation of a $2.5 billion data center campus expected to launch in 2024. The 1.5 million square foot campus is expected to launch in 2024 and will create 75 to 100 jobs for each of the three planned buildings. The development will generate up to 3,000 construction jobs while it is being built.
According to the Chicagoland Chamber of Commerce and Data Center Coalition, six new data centers were committed to investing at least $1.7 billion in 2020 and seven additional data center developments committed to investing at least $2.5 billion in 2021. As of May 31, 2022, those projects had delivered $3.3 billion of that total investment. The investments included $800 million by Meta in DeKalb and three Microsoft projects totaling over $900 million.
Rep. Charlie Meier (R-Okawville) has worked with the Illinois Chamber of Commerce for over six years on legislation to bring more data centers to Illinois. “The recent skyrocketing trends for data center development in Chicagoland are very exciting news for Illinois’ economy,” stated Rep. Meier. “In southern Illinois, we have the space, we have the incentives, and we have the job seekers ready for these developments to come to our region as well. The tax incentives are an incredible tool to help attract these companies. I will continue to work to make this a reality.”