Google affiliate’s latest move signals selection of KC for $600M data center
Miranda Davis – KC Business Journal
Google’s Northland data center appears to be in startup mode.
Shalerock LLC, the Delaware-based limited liability company that Google is operating as in Missouri, has executed a deed that would grant it several lots within Hunt Midwest Business Park, the first move the company has to take toward building a proposed $600 million data center in the Northland area of Kansas City.
The deed was executed on Tuesday, according to records from the Clay County Recorder of Deeds office. According to the deed, Shalerock paid $10 to Hunt Midwest for about 80 acres.
Google has been extremely quiet about its plans to bulid the data center, with local economic development officials saying they have been working behind the scenes for more than a year. The project first became public at the Port Authority of Kansas City’s July 22 meeting, where the board approved a resolution authorizing Port KC to issue bonds for the project.
Agencies behind the project — which goes by the code name “Project Shale” — seek a 35-year, $25 billion, privately backed Chapter 68 bond from Port KC. Should the project move forward, Google would finance all project purchases with its funds, and Port KC would hold the title to the property and lease it to Google.
Port KC, which is a government body with the ability to grant development incentives, uses Chapter 68 bonds to create property tax breaks similar to, though generally more substantial than, the property tax abatements other local economic development agencies grant. Port KC does not require blight, cost-benefit or “but-for” analyses of development projects, and the agency is not subject to the city’s 75% exemption cap.
Google also is expected to make payments in lieu of taxes (PILOTs) to Port KC, which would distribute those to taxing jurisdictions, including the North Kansas City School District, Clay County and Kansas City. However, it’s unclear how much Google would pay in PILOTs.
According to Port KC, Google also would pay fees that would go toward infrastructure improvements at the former AK Steel Corp. mill site, which Port KC bought in August 2018. Port KC aims to transform the 415-acre site into an inland intermodal port.
At the time of the Port KC meeting, Google, the primary unit of Alphabet Inc. (Nasdaq: GOOGL), had not finalized plans to build the center in Kansas City.
Google has built similar data centers nationwide, in markets such as Minneapolis and Dallas. The large buildings essentially house the company’s servers and require significant power resources.
The first phase would bring about 30 jobs to the area, in addition to construction jobs. However, the company could build additional phases beyond the initial $600 million investment.