This article originally appeared in the Phoenix Business Journal.
A proposed 422,000-square-foot data center and office campus in Chandler’s South Price Road Corridor will move ahead for city approval, despite concerns raised by Chandler planning staff that the envisioned project does not meet land use needs for the area.
The developer, New York-based Active Infrastructure, has proposed a Price Road Innovation Campus on a 40-acre property located at 3380 S. Price Road in Chandler.
The Chandler Planning and Zoning Commission heard a rezoning request and preliminary development plan Oct. 15, after city staff recommended denial of the project.
However, following a discussion that exceeded two hours, the commission voted 5-1 to recommend that City Council approve the proposed rezoning and development plan project at its Nov. 13 meeting. The commission added stipulations including a redesigned site plan layout that creates a more “campus-like environment” using the site’s water feature as a campus focal point.
Rick Heumann, chairman of the planning commission, cast the lone vote against the measure.
The proposed campus includes an artificial intelligence data center and five buildings for offices and research and development. The additional buildings do not yet have confirmed tenants.
The Oct. 15 planning meeting included comments from attendees in favor of and against the proposal. Former U.S. Sen. Kyrsten Sinema, now the president and CEO of the Arizona Business Roundtable, spoke at the meeting in favor of the project.
“I would urge Chandler to approach the AI revolution the way you approached the semiconductor revolution,” she said. “Think about tomorrow, three years, five years down the road. Not the language from 10 years ago, which didn’t even encompass the idea of the AI technology that we face today.”
The data center site selected by Active Infrastructure has sat vacant since 2019, and a 369,000-square-foot building on the property is unoccupied.
The corridor has been planned as a major employment hub for the city since 1982, said David de la Torre, planning manager for Chandler. Major employers in the area include Intel, Wells Fargo, Northrop Grumman and Iridium.
Growth policies for the area are focused on reserving the corridor for knowledge-based industries and preserving and expanding campus-like environments.
“Staff finds that data centers provide significantly lower numbers of jobs after construction is complete compared to the high-value employment industries that are targeted for the corridor,” de la Torre said.
Knowledge-based industries include technology, biomedical, aerospace and renewable energy, he said.
A nearby city-operated water reclamation plant causes a stench at the site, de la Torre noted, which can be mitigated with the right configuration of buildings on the site.
Adam Baugh, a partner with Phoenix-based Withey Morris Baugh PLC and representative for the developer, told the commission that the project is much more than its proposed data center.
The campus is projected to be a $2.5 billion investment that will create more than 1,200 construction jobs and more than 700 permanent jobs, he said.
“We’re bringing modern technology that drives new industries and uses to this area, that create the jobs that you’re looking for,” he said.
The campus is proposed to be constructed in three phrases. The first includes the data center and a 50,000-square-foot office building.
The second phase includes construction of two additional 42,000-square-foot buildings, and the third phase will be construction of a 66,000-square-foot building and a 71,000-square-foot building.
“The 9-acre data center here unlocks the remaining 31 acres of this property,” he said, adding that the envisioned data center is the kind that will attract industries to bring new operations into the area.
“You’re not getting just a data center. You’re getting a significant degree of employment on the remaining property. But if I don’t have a data center, I can’t deliver the other buildings.”
Part of the potential development agreement is a stipulation that the developer will cover the cost of failing to attract new jobs to the site, in part through annual payments if construction deadlines are not met.