Why Struggling Cannabis Growers Are Betting On The AI Data Center Boom
Harbor Farms owner Michael Ward sought to convert his struggling cannabis cultivation facility in Kalamazoo, Michigan, into a small AI data center. Although the city initially granted zoning clearance, intense community opposition over noise, electricity, grid capacity and water use led the Kalamazoo City Council to enact a moratorium blocking data center development through August 2027, killing the conversion plan.
Michael Ward invested $20 million in Harbor Farms, a 32,850-square-foot cannabis cultivation facility in Kalamazoo, but falling marijuana prices and Michigan taxes sharply reduced the business's revenue. Because the facility already had fiber, HVAC systems and significant electrical capacity, Ward partnered with consultants Phil Devise and Eric Mack to market a conversion into a smaller AI data center that he estimated could generate about $1 million in annual tax revenue for Kalamazoo and Michigan.
Kalamazoo granted zoning clearance for the conversion in April, but the proposal triggered online backlash and a contentious five-hour City Council meeting. Residents cited potential noise pollution, higher electricity bills, grid overload and water depletion, and the council subsequently enacted a moratorium on all data center development in Kalamazoo through August 2027. Ward withdrew the listing in September, leaving Harbor Farms without an immediate redevelopment path. The story also notes that Oracle is building a much larger facility for OpenAI in Saline, Michigan, while industry lawyers see potential for smaller cannabis facilities to serve as regional inference data centers.