CloudHQ Breaks Ground on $2.5B Chicago Data Center Campus

The site of the future CloudHQ hyperscale facility. Photo via Google Street View

Construction has started on a 1.5 million-square-foot hyperscale data center campus in metro Chicago’s Mount Prospect, Ill. Global data center provider CloudHQ will invest $2.5 billion in the project’s development over several years.

CloudHQ will construct a total of three buildings on the former site of the United Airlines headquarters, at 1200 E. Algonquin Road and 1200 Dempster St. in Mount Prospect.

According to Village of Mount Prospect’s Planning and Zoning Commission, United Airlines completed the move of its headquarters operations in 2012. Later in 2013, the company built a 172,000-square-foot data center adjacent to the site, which is not part of the new development. CloudHQ acquired the 49.7-acre site from United Airlines last year, according to documents filed with Cook County Clerk’s Office. Under the terms of the development agreement, CloudHQ demolished the existing buildings to make way for the upcoming data center.

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Plans call for three data center buildings, each totaling more than 560,000 square feet and offering a capacity of 84 megawatts. Energy provider ComEd—a unit of Exelon Corp.—will develop a new power substation as part of the upcoming project, as well as extend high voltage lines and provide additional technology investments. CloudHQ will seek LEED certification for the campus. The initial phase of construction, comprising the first building, is set to be completed in 2024, with the additional two to be built, depending on market demand, over the next three to five years.

Economic Benefits

According to the announcement by ComEd, the initial phase of construction will create more than 1,000 construction jobs over the two-year period, while subsequent phases might see an additional 2,000 full-time construction jobs. A recent quarterly economic report by the Village of Mount Prospect shows that upon completion, every building will require the creation of as many as 125 high-paying permanent jobs. The same report estimates that the project will generate between $1 million and $2 million in tax revenue per year.

In 2019, Illinois passed the Data Center Incentive Program, a legislative package that aims to bolster growth of the metro’s digital infrastructure. According to ComEd, 15 new data center projects have been initiated since, with six of them generating a total of $2 billion in investments in 2021.

Chicago’s Elk Grove Village, situated roughly 5 miles south of CloudHQ’s development, is home to several other large data center facilities, operated by NTT Data, Digital Realty, Equinix, Cyxtera and Stream Data Centers, among others. A recent CBRE report shows that this year, nationwide demand for data center space tripled year-over-year, with hyperscale developments remaining the biggest users.

According to the same source, Chicago had an inventory of 306 megawatts as of June this year, making it the fourth-largest primary data center market in the U.S. The metro had 91 megawatts under construction, while vacancy was at 7.5 percent in the first half of the year.