Prime Data Centers Plans $1 Billion Project in Suburban Chicago

Prime Data Centers is entering the Suburban Chicago market in a big way. The developer says it will invest $1 billion to create a three-building,  750,000 square foot data center campus in Elk Grove Village, the leading cloud hub in the Western Chicago suburbs near O’Hare Airport.

The project will be Prime’s first project outside of California, and is expected to support up to 150 megawatts of capacity, the company said.

“We are excited about the opportunity to enter the Midwest market in a big way,” said Jeff Barber, Prime’s EVP of Sales and Business Development. “These types of facilities are in high demand from some of the world’s largest companies. Partnering with Elk Grove Village to meet the demand for data center capacity is incredibly strategic to both Prime and the greater Chicago market in general.

“This is an exciting next step in our journey as we continue to expand to strategic data center locations across the United States and the world,” he added.

Prime’s expansion illustrates how investor interest in digital infrastructure is translating into large new data center projects, This week’s announcement follows a strategic equity investment from Macquarie Capital, the investment arm of global infrastructure fund Macquarie, which plans to  commit significant capital to help Prime become a larger player in data center development. The partnership has targeted capital investments in excess of $5 billion over the next 10 years.

Prime is a privately held developer based in Sacramento, where it is developing a campus at McClellan Park with room for up to six data center buildings. The company recently announced an 8 megawatt build-to-suit lease with a publicly-traded global enterprise.

The Sacramento project is one of several California developments for Prime Data Centers, which was founded in 2019 and offers customers flexible ownership and leasing models for their projects, with options including sale-leasebacks or greenfield developments. The company also owns a fully-leased data center in Hayward, Calif. and is developing a 9 megawatt data center in Santa Clara in Silicon Valley.

Chicago is a major hub for Internet and financial infrastructure, with active communities of data center users and service providers. Many data center developers have expanded in the western suburbs surrounding O’Hare Airport, which has become a leading destination for hyperscale users.

Data center activity in Greater Chicago has surged since 2019, when the region’s competitive position got a boost as Illinois approved new tax incentives. That included a robust 71 megawatts for 2020, third-best in the U.S. after Northern Virginia and Silicon Valley, according to real estate sources.

Prime is the latest in a series of new market entrants in Suburban Chicago in recent months include Aligned, which is building a 60-megawatt facility in Northlake, and Skybox Data Centers , which is teaming with Prologis to develop a 30-megawatt data center in Elk Grove Village.