Microsoft Buys 21 Acres to Expand Atlanta Data Center

Microsoft is ramping up its data center operations in the Atlanta area.

The Redmond, Washington-based tech giant recently paid $6 million for nearly 21 acres of land to expand its data center campus in Palmetto, about 30 minutes southwest of Atlanta, the Atlanta Journal-Constitution reported. That’s over $285,000 per acre.

Data centers, used for storing computing machines and related hardware equipment, have proliferated in the Atlanta metro, where about 20 massive data center campuses are either under construction or poised for expansion. Such developments have been particularly attractive in rural areas, like Palmetto, with large swaths of untouched land.

However, the growing presence of data centers has sparked controversy among communities, utility companies and lawmakers. The Georgia House recently approved a bill aimed at suspending sales tax exemptions for equipment housed in data centers. Concerns have been raised about the strain these facilities place on power grids and the substantial resources they consume.

Georgia Power, the state’s largest electric utility, is seeking regulatory approval for significant increases in electricity-generating capacity, largely driven by the proliferation of data center projects. Executives from Georgia Power have attributed roughly 80 percent of the demand crunch to data centers.

Microsoft has emphasized that incentives play a role in its decision making for new facilities, although they are just one of many factors considered. The Palmetto data center campus received a $14.5 million property tax break from the Development Authority of Fulton County in 2020, when the 250,000-square-foot facility was valued at $420 million, the outlet reported.

Elsewhere in the Atlanta area, Mirosoft has ongoing data center projects in East Point and Douglasville. The recent land acquisition aligns with projections that the Palmetto campus could span up to 116 acres by 2028.

The purchase also comes at a time of mounting pressure on Microsoft to clarify its intentions for a 90-acre site in Atlanta’s Grove Park neighborhood. Mayor Andre Dickens has urged Microsoft to promptly decide on either resuming its campus plans or allowing the city to pursue alternative developments for the site.

—Quinn Donoghue