Fast start to Cedar Rapids data center projects

In the period of just a few months, the amount of change around the Big Cedar Industrial Park — home to Cedar Rapids’ two data center projects — is nearly impossible to miss.

Excavation across hundreds of acres of land has moved rapidly, and large earth moving equipment and cranes are positioned across the sites. The construction of the two largest projects in the city’s history is happening on parcels next to each other just off Edgewood Road.

The Google project is projected at $576 million, while the QTS project exceeds $750 million. The projects are expected to bring a significant uptick in construction jobs, while the hiring push for the sites is in early stages.

On Tuesday, QTS senior leadership will be in Cedar Rapids, along with Gov. Kim Reynolds and other leaders, to recognize the start of construction on the QTS site.

For Cedar Rapids, a city known for food and agricultural industries, avionics, GPS and other engineering, the establishment of two large data center projects represents the start of another industrial sector for the city.

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What does a data center do?

A data center is a facility that houses computer servers, data storage and other equipment that stores information and returns information to end users.

With increases in artificial intelligence, cloud hosted data, the number of data center projects nationally is growing.

During the Google groundbreaking event, company officials said the Cedar Rapids facility would be used to support the company’s operations.

“It’s about advancing scientific breakthroughs. It’s about fortifying cybersecurity, and very importantly … it’s about creating new jobs, new career opportunities for Americans and across the state,” President and Chief Investment Officer for Alphabet and Google Ruth Porat said at a press event in late May in southwest Cedar Rapids.

QTS’ facility will be somewhat different because its center will be used or leased by another company or companies. QTS, which operates more than 75 data centers in the United States and Europe, has declined to comment who will use its Cedar Rapids facility.

What will the data center facilities look like?

Google is planning to construct at least four large buildings on its site, company officials said during the May groundbreaking. The phase currently under construction will likely be completed in 2026. The Google data center in Cedar Rapids is expected to be among the city’s largest water users, though the company, utility and state geologist have all indicated there is adequate water supply.

The QTS Cedar Rapids data center campus will be on about 600 acres and will include seven one-story buildings, ranging in size from about 400,000 to 1.1 million square feet, QTS officials said. The exact specifications of the buildings will be subject to change, they said. The project will be done in two phases, with completion of the first phase in 2026 and a second phase being completed about a year later.

The QTS facility, however, is expected to use significantly less water, because of a closed loop design using refrigerant, a standard the company put in place in 2018.

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“We believe water is a commodity and a resource that needs to be taken care of,” QTS co-CEO David Robey said in an interview with The Gazette. “It’s not only evaporation of water and water usage as an impact on our communities and all of us as a society, but it also puts a burden on the water treatment plants and all the infrastructure required to support those, you know, from a data center. So we believe the right thing is to not use water from a heat rejection source as an evaporative source.”

Why are projects happening in C.R. now?

The rapid development of artificial intelligence, combined with high demand for cloud services, has led to a surge in data center construction throughout North America, according to CBRE Group Inc., a Dallas-based commercial real estate services and investment firm.

Tech companies have been lured to Iowa — with Microsoft, Meta and Apple joining Google in building data centers in the state — with its affordable, ample and environmentally friendly wind energy, a stable grid, access to high-speed fiber-optic connections, low construction costs and tax incentives. Google began its investment in Iowa in 2007 in Council Bluffs, while this is QTS’ first development in Iowa.

These projects evolved on different trajectories. The Google project developed over the span of more than five years, with some of the first meetings occurring in homes of employees, so site selectors wouldn’t be recognized. The QTS project came later, and materialized in a span of months.

Josh McKnight, manager of data center services for Alliant Energy, said they had created a number of RFIs for the state and local economic development groups to try to land projects for the site.

“With the recent uptick in data center activities and AI that certainly just naturally attracted folks to this region,” McKnight said. “So when you have this precipice — the perfect combination of power infrastructure provided by our transmission partners at ITC Midwest, when you have the site certification that we did with the city of Cedar Rapids in the state of Iowa, and then when you look at some of the other economic development, things that we did proactively, it just made a perfect opportunity for the data centers to target us and really come to us versus us reaching out.”

Though Cedar Rapids has not had data centers before, QTS said the alignment between Alliant, Cedar Rapids officials and the company has been strong, and it helps that the project is a win for everyone. He noted additional supports, aimed at workforce.

“I absolutely think the more you can speak and plan for the future, the more successful our parties are going to be in their partnership. Ultimately, this is a long-term partnership which all parties, you know, thrive and benefit from,” Robey said. “We all only win when there’s an intersection of value proposition for all groups involved.”

Alliant Energy also is partnering with QTS on a similar data center project in Wisconsin. As many as 15 buildings could be developed in Wisconsin about 15 miles north of Madison, which also is in the Alliant service territory.

“We were made aware of their ability to deliver power in Wisconsin,” QTS co-CEO Tag Greason told Wisconsin Public Radio earlier this month. “Then we said, ‘OK, let’s start to look at opportunities that would meet the land requirements and the workforce requirements.’ And we were able to identify some land in Vienna.”

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Why are these facilities being built next to each other?

The co-location of data center projects isn’t uncommon.

“You’ll see many times that there will be a collocation of data centers,” Robey said. “However, you know the data centers will work very autonomously. There’s no interaction necessarily between the two of them.”

The utilities needed to service these projects are significant and other costs, for things like fiber, can be shared, he said.

“Not to be overlooked is the economic impact and the ecosystem around those data centers can start to grow the supporting industries,” Robey said. “If there is some accumulation of facilities there, it allows for those resource teams to become more efficient to grow and I think it really has a positive impact on the community when you can leverage that.”

Google estimates that more than 1,000 construction jobs will be created.

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With technological changes, how do data centers adapt?

While the exterior of the facility may not change, companies routinely make changes to the equipment inside a data center.

Google has had operations in Iowa since breaking ground on its Council Bluffs data center in 2007. During its May groundbreaking in Cedar Rapids, the company said it also will expand its cloud and AI infrastructure at the Council Bluffs complex.

At QTS, Robey said while the outside may not change much during the building’s 30- to 50-year life span, the inside of the building is built to be flexible to future technological changes.

“These facilities are built with every thought in mind around how do I make sure I prepare for the next wave of chip sets or the next technology solution that becomes available,” Robey said. “You’re looking at refresh changes every five years, so you’re looking at many, many refreshes.”

Those “internal retrofits,” Robey said, also will create the need for additional workers to support the changes.