Meta meets Minnesota: How data centers drive growth in local economies

Meta meets Minnesota: How data centers drive growth in local economies

Writer: Ryan Gandolfo

3 min read September 2023 — Project Skillet, Project Woolhawk and Project Peregrine — all three conspicuous names and a dozen or so more share one tying entity: Meta.

Through a recent filing with the Minnesota Public Utilities Commission, it was confirmed Meta, the parent company of Facebook, has a new $700 million data center project in the works. Codenamed ‘Project Bigfoot,’ the facility will be located at Dakota County’s UMore Park in Rosemount, 30 miles south of the Minneapolis-St. Paul area. Earlier this month, the University of Minnesota Board of Regents voted to sell 280 acres of UMore Park space to the technology giant for $39.7 million. The data center site will sit in the northeast section of the 4,772-acre property.

Greater MSP, an organization connecting businesses with communities for relocation and expansion, told Invest: and local media outlets that the group “has been working on this project for over a year with local partners, including Dakota County, the City of Rosemount, DEED, the University of Minnesota and Xcel Energy. This is an active and competitive project that is significant for the region. We will continue to support it.”

Star Tribune reported that the University of Minnesota and other public and private stakeholders had been marketing the site for potential development for decades. 

Meta defines their data centers as part of the company’s “global infrastructure that brings our technologies and services to life, along with future immersive experiences like the metaverse,” with 17 facilities currently based in the U.S. 

The company’s data center website prominently features its impact on local economies, tallying over 250,000 jobs supported and $14.2 billion in total capital investment.

Similar to other U.S. cities, Meta’s presence in the MSP area would add an economic boost not only in job creation but also potential infrastructure improvements. “Meta paid for the extension of the main road through our Industrial Center which serves 20 other businesses. This road allowed us to connect the center to a second main highway, giving hundreds of workers an alternate route with a signalized intersection. The road also provided another access for emergency and safety personnel,” Gallatin Economic Development Agency (EDA) Executive Director James Fenton told Invest:.

The Middle Tennessee-based EDA worked with Meta to deliver a data center in Gallatin back in 2020. According to Fenton, the project created more than 1,200 construction jobs and hired locally for some of the 100-plus permanent jobs at the data center site. “Once all Meta’s buildings are operational, Meta will be the largest revenue stream in [Sumner] county,” Fenton said.

Meta’s investments in both its own facilities and the surrounding community are palpable. However, at the end of 2022, the company pushed the pause button on construction for its $800 million data center in Temple, Texas, in addition to an overseas data center in Denmark. A company spokesperson said the construction pause was made to “change the design” of its upcoming Texas facility, as cited by Construction Dive. The company is reworking multiple projects that were under development to handle AI workloads.

Despite project pauses for Meta and competitors like Amazon and Google amid mass layoffs in the tech sector at the start of 2023, the data center construction business is slated for significant growth over the next few years. According to IT research firm Omdia, the big four hyperscale data center builders — Amazon, Google, Meta and Microsoft — spent $94 billion on data center-related capital expenditures in 2022. With public cloud ecosystem revenues forecasted to double between 2022 and 2026, the number of data centers are expected to grow at a similar pace. 

For local economies, data center projects present a diversification opportunity. “Until 2017, Gallatin was known primarily as a manufacturing community. Since then, Gallatin has a more diverse business base that tends to weather economic uncertainties well. The city has not raised its property tax rate in 18 years. Landing Meta helped us maintain that diverse business base,” said Fenton.

Top image via Meta

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