Study: data center growth concerns renters

A new report from Apartments.com highlights growing concerns among renters in Phoenix regarding the proliferation of data centers, identifying the area as a "data center hot spot" alongside Chicago, Dallas, and northern Virginia. Despite these concerns, a specific development by California-based Menlo Equities in Ahwatukee is proceeding, though it faces local opposition. The project involves a 1-million-square-foot data center-office campus, and Menlo Equities is seeking a minor stipulation change. Neighbors have initiated a fight against the project, launching a petition that garnered nearly 900 signatures, urging the city to block further data center development until potential impacts are fully understood and mitigated. The petition cites the high water and electricity consumption of data centers and argues that the projects offer minimal economic benefit while stressing existing resources. The Apartments.com report elaborates on the impact of data centers, stating they contribute to increased utility costs, infrastructure strain, and livability concerns for renters, rather than driving rent growth through new residents. The report notes that data centers consume a significant portion of U.S. energy, a figure projected to rise, and can use electricity equivalent to 100,000 households annually. While data centers also require substantial water resources for cooling, Menlo Equities states their facility will be air-cooled. Residents are worried about increased traffic, noise, and environmental impacts, particularly on air and water quality, and the potential strain on the power grid leading to higher utility bills. Although Phoenix has implemented an ordinance regulating data center development, the Ahwatukee project may be grandfathered. Despite these issues, the report suggests that Phoenix's rental market remains favorable for renters due to affordable rents and a balance between demand and supply, even as data centers fuel economic growth.