Meta sells part of Mesa data campus

Meta has sold 15 acres of its 396-acre campus to a neighboring data center company EdgeCore for $1.2 million.

The triangular parcel is just east of Meta’s planned 2.5-million-square-foot hyperscale data center in Eastmark, expected to start operations early next year.

The Feb. 15 sale represents a relatively small piece of Meta’s total Mesa holdings. After the sale, Meta still holds 172 acres of vacant land to the south of the first two phases of its Mesa data center.

“We didn’t need the land, so agreed to sell it to EdgeCore,” Meta spokesperson Melanie Roe said in an email.

An EdgeCore spokesperson told the Tribune that the additional acreage will be used to expand its Mesa campus into a campus with five data centers totaling 1.1 million square feet.

Roe pointed out that the 15-acre triangle of land is separated from Meta’s data center by a road, but the land is contiguous with EdgeCore’s existing data center campus on Everton Terrace in Eastmark. 

EdgeCore’s interest in growing its Mesa campus is a sign that Arizona’s data center industry has momentum despite current uncertainties over long-term drought and the quantity of Colorado River water available to Arizona in the future.

Mesa Councilwoman Jenn Duff has questioned whether data centers are an industry the city should be courting, since the ratio of permanent jobs created to energy and water resources consumed is lower than other industries.

But proponents of data centers argue that they contribute to the overall high-tech economy and help attract complementary businesses.

One company that is betting on continued data center growth in Arizona is national construction firm Adolphson and Peterson Construction, which has offices in Tempe.

The company recently hired data center specialist Darian Reams to grow AP’s national data center business and tap into a market that Reams said is “just continuing to explode.”

Reams spoke to the Tribune about his predictions for continued data center growth in Mesa and the wider region.

According to Reams, Arizona is currently No. 9 in the country for data centers, and he thinks the state is poised to crack the top 5 states for data centers in the next year.

All the headlines about drought and the Colorado River isn’t scaring off data centers, he said. Instead, the West’s water woes are pushing the industry to develop more water-efficient technology.

Water “will never deter them from Arizona,” Reams said of data center providers. The current advantages to Arizona are too enticing, and there are too many alternatives to massive water usage on the horizon.

Instead of fleeing, Reams believes data center operators will switch to emerging technologies like immersion cooling the servers packed into the centers.

Reams says operators are salivating over Arizona because of the relatively low cost of energy, affordable real estate and tax breaks the state offers data centers.

In 2021, Arizona renewed tax incentives for data centers that invest at least $50 million in data centers in Pima and Maricopa counties, or $25 million in any other counties.

And as one of the most energy-intensive building types per square foot, energy cost is huge for the industry.

“The difference of a few cents per kilowatt can mean millions of dollars saved in data center transactions,” EdgeCore states on its website.

Reams said the presence of mega projects like the Meta’s Mesa data center also creates momentum for the region.

“What you tend to see is once a big hyperscaler like Meta comes in there, you start to see all these other co-locations – smaller data centers start populating to that area,” he said.

The magnetic draw from big projects is bearing out in the Elliot Road Tech Corridor, which could also be called Data Center Alley. 

There are at least seven data centers currently built or planned along Elliot Road in Mesa.

Reams sees data centers as a growing industry. A person creating a TikTok, browsing the internet or interacting with a network-enabled device is generating data in the cloud, and all that data needs to be stored somewhere.

“Big data is not going away,” Reams said. “You look at how virtual reality, artificial intelligence, all that stuff is just on the verge of just exploding even more. It just takes that much more of these data centers to house that stuff.”