the data center that occupies the former Chicago
Sun-Timesí printing facility is like walking through
the set of a James Bond film.
a 10-foot-tall steel fence encircling the property on
the Lower West Side. There are gates, buzzers, a
security desk, cameras and doors that use fingerprints
as their key. The final entry into the room full of
locked server cages requires an iris scan.
by societyís ever-increasing dependence on the cloud,
demand for data centers is insatiable. The Chicago area
ranks third in the country for data center capacity, but
an increasing number of states, including neighboring
Iowa, are wooing the facilities with tax incentives.
contrast, there are no incentives available in Illinois
specifically for data centers, which can bring economic
benefits like improved power grids and
telecommunications systems. Those upgrades in turn help
attract more companies and more jobs to Chicago. Some
worry the lack of incentives could hinder industry
growth in a state thatís a hub of internet
will get left behind if they donít do something about
it," said Butch Goldi, an executive vice president
of sales for Quality Technology Services, which owns the
data center in the old Sun-Times facility.
several years, Chicagoís supply of data center
capacity has increased with the demand. Measured in
megawatts, capacity grew by more than 60 percent ó
adding enough to power more than 70,000 homes for a
month ó between 2015 and 2017, according to
information from real estate firm CBRE. The only markets
in the country with more data center inventory are
Northern Virginia, home to many of Amazonís data
centers, and the Dallas-Fort Worth area.
developed as an attractive market for data centers for
the same reason it became a hub for railroads: its
central location. Much of the fiber optic cable the
internet runs on was laid along railroad tracks, and
Chicago acted as the connector between east and west.
Plus, the city has reliable electricity and isnít at
risk for the hurricanes or earthquakes that threaten the
Rene Martinez works on connectivity for a customer at
the Quality Technology Services data center. (Antonio
Perez / Chicago Tribune)
Business Chicago, the cityís economic development arm,
touts data centers as one of the perks of locating in
Chicago, said Dennis Vicchiarelli, executive vice
president of business development for the public-private
itís airplanes, itís railroads, and itís
transportation via highway, but itís also fiber and
data centers," he said.
city has worked to accommodate data centers, updating
regulations to allow on-site fuel storage for backup
generators, for example, Vicchiarelli said.
state needs to do its part as well, said Benjamin
Brockschmidt, vice president of policy for the Illinois
Chamber of Commerce. Data centers are economically
beneficial to the areas where they locate, adding
construction and contracting jobs, plus permanent
positions at the facilities, he said. They also produce
local infrastructure improvements such as power and
telecommunications access, which can benefit other
businesses in the area.
Chicago area is attracting co-location data centers,
facilities like the one in the old Sun-Times building,
where companies can house their servers. But the tech
giants, such as Google and Amazon, have not put their
data center facilities in Illinois, Brockschmidt said.
attracting the bare minimum that the market is willing
to fill," he said. "Weíre not attracting the
maximum here that we could because weíve limited our
lawmakers have introduced bills to create tax credits
for data centers in the past, but theyíve stalled. The
stateís Department of Commerce and Economic
Opportunity recognizes the potential the facilities hold
for Illinoisí economy, spokeswoman Jacquelyn Reineke
said. The department often helps data centers figure out
how established incentive programs can work for them,
state entered into an agreement with RagingWire Data
Centers in December 2016 that could be worth $1.4
million over a decade. The agreement was part of the
EDGE program, short for Economic Development for a
Growing Economy, which provides tax breaks for companies
that promise to create jobs in Illinois. RagingWire was
required to create 51 full-time jobs and invest $176
million into an Itasca facility.
state is working on a few other data center projects as
well, but Reineke declined to comment on the pending
definitely open to finding a way to facilitate their
growth," she said.
days, businesses need more computing capabilities and
therefore more server space, said Todd Bateman, who
leads CBREís data center solutions agency practice.
Companies that have housed their servers on their own
properties for years are moving them to data centers,
seeking out their security, connectivity, a reliable
power supply and around-the-clock support.
response, the firms that build data centers are making
them more efficient and offering larger chunks of space
for servers. New players have entered the Chicago market
to respond to the demand.
Quality Technology Services data center has about 24
megawatts of power available now and is working with
ComEd to build a new substation on-site thatís
expected to increase capacity to 125 megawatts by the
end of 2019. (Antonio Perez / Chicago Tribune)
Technology Services opened the data center in the former
Sun-Times printing plant about two years ago, and the
Overland Park, Kan.-based company is expanding. It has
about 24 megawatts of power available now ó enough to
fuel more than 19,500 homes for a month ó and is
working with Commonwealth Edison to build a new
substation on-site thatís expected to increase
capacity to 125 megawatts by the end of 2019.
data hall that houses cages of servers in Quality
Technology Servicesí facility ó the one that
requires an iris scan to enter ó is filling up. The
servers, routers and other equipment, with their
blinking lights and erupting wires, are stacked in rows
and locked in cages. On a recent morning, two
neon-vested workers were building out a cage for a new
customer. The company has another data hall ready for
customers and has space on the property to construct
moved some of its servers into the facility in November,
said Rick Hanzelin, the online grocery delivery companyís
vice president of information technology infrastructure.
The Chicago-based company had servers at its facilities
around the country, including at its former headquarters
in Skokie. As Peapod grew, it would add data centers at
its office buildings or warehouses.
needed to move its systems to a space that would allow
it to expand quickly, Hanzelin said. Quality Technology
Servicesí facility provides that, he said, and thereís
no worrying about the electrical grid or power outages
like there was when the company housed its own servers.
know how summer storms move through here," Hanzelin
said. "There were multiple times when the generator
would have to kick on. Thatís the kind of stuff we
want to let the professionals handle as we go
position as a hub for connectivity also is demonstrated
in the data center at 350 E. Cermak Road. Besides
servers that companies have located there, the facility
houses major telecommunications carriers, such as Sprint
and Verizon, and other networks. Customers that need to
connect to those carriers or networks come to the South
Loop facility to do so.
like the central nervous system of the internet, said
John Stewart, senior vice president of investor
relations of Digital Realty, the San Francisco-based
real estate investment trust that owns the facility. The
century-old building has the bones to support all the
servers and equipment. It was originally built for
printing presses that kicked out phone books and Sears
a common method among data center developers: Take old
buildings or sites that can support massive amounts of
equipment and transform them into a hub of power and
connectivity. In another example, an investor is
planning to convert the site of an old coal-fired power
plant in Hammond into a data center. The Indiana
Economic Development Corp. approved an incentive of up
to $9 million for that facility, based on an investment
of nearly $36.2 million.
facilities are a bit more incognito. Digital Realty owns
nine other data centers in the Chicago area, including
three on a campus in Elk Grove Village that from the
outside look like warehouses.
media company Farm Journal recently relocated its
servers to one of those facilities. The companyís
previous data facility in its former Philadelphia
headquarters amounted to a rack of old equipment in a
wasnít a proper data center," said John MacMillan,
director of applications and information technology at
the company, now based in Lenexa, Kan. "There were
times when the network in the building would just go
down and youíd just have to sit through it and
added network reliability was a priority for Farm
Journal in its server relocation, MacMillan said.
move was also about reliable electricity and cooling,
and "sleeping well at night knowing the lights will
be on," he said. "Everything will be