According to DCD, data center developer Karis Critical has significantly scaled back its plans for a Naperville, Illinois data center campus, reducing the project from two 211,000 square foot buildings totaling 72MW to a single 36MW building. The company cited local feedback and power capacity limitations as key factors in the decision, with city officials confirming the current power grid could handle only the first phase. The development is proposed for the former Alcatel-Lucent campus at 1960 Lucent Lane, where buildings were demolished in 2023, and faces opposition from residents who have gathered approximately 2,000 signatures against the project. The Naperville Planning and Zoning Commission has delayed its recommendation until November, while local group NEST is calling for a six-month moratorium on data center approvals. This scaling back reflects broader challenges facing data center development in established suburban markets.
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The Chicago Data Center Gold Rush
The Chicago metropolitan area has become one of North America’s hottest data center markets, with Chicago serving as a critical network hub between East and West coast connectivity. What makes this region particularly attractive is its combination of robust power infrastructure, competitive energy costs, and strategic location along major fiber routes. The I-88 corridor where Naperville sits has emerged as a particularly desirable submarket, offering proximity to major business centers while providing more developable land than downtown Chicago. However, this rapid expansion is now testing the limits of local infrastructure and community tolerance, creating a classic case of infrastructure development colliding with suburban quality-of-life concerns.
The Power Capacity Reality Check
The revelation that Naperville’s power infrastructure can only support 36MW of the originally planned 72MW development speaks to a broader industry challenge. Modern data centers are incredibly power-intensive, with AI workloads driving power densities to unprecedented levels. While municipalities often welcome the tax revenue and high-tech image that data centers bring, many are discovering their electrical grids weren’t designed for such concentrated power demands. This creates a chicken-and-egg problem: utilities need guaranteed demand to justify infrastructure upgrades, but developers can’t commit without knowing the power will be available. The situation in Naperville suggests that even well-developed suburban markets may face hard limits on how much data center capacity they can realistically support without massive grid investments.
Community Opposition Goes Mainstream
The organized resistance in Naperville represents a growing trend where communities are pushing back against data center development. The Naperville Environment and Sustainability Task Force’s call for a moratorium mirrors similar movements in Virginia’s Loudoun County and other data center hotspots. Residents are increasingly concerned about noise from cooling systems, visual impact on communities, and the enormous water consumption required for cooling. What’s particularly telling is that opposition is emerging even against “boutique” developments like Karis’s scaled-back project, suggesting that communities are becoming more sophisticated in their understanding of data center impacts rather than simply opposing large-scale facilities.
The Brownfield Development Advantage
Karis’s choice of the former Alcatel-Lucent campus represents a strategic approach to navigating community concerns. Brownfield redevelopment of existing industrial or commercial sites often faces less resistance than greenfield development, since the land already has industrial zoning and infrastructure. The site’s history as a technology campus dating back to Bell Labs in the 1960s provides additional credibility, suggesting the area has long hosted technical facilities. However, as the opposition shows, even brownfield redevelopment isn’t immune to community concerns when the proposed use represents a significant increase in scale and impact compared to previous occupants.
Chicago’s Competitive Data Center Landscape
The simultaneous development of Hut 8’s 50MW facility in nearby Batavia highlights the intense competition in the Chicago market. With multiple developers racing to secure positions in the region, communities like Naperville find themselves in a position to be selective about which projects they approve. This competitive pressure may force developers to offer more community benefits, adopt stricter environmental standards, or consider alternative locations. The phased approach that both Karis and Hut 8 are taking—starting with smaller capacities and planning future expansion—reflects a cautious strategy in an uncertain regulatory environment.
The Coming Regulatory Wave
The calls for moratoriums and better ordinances in Naperville signal what’s likely to become a broader regulatory trend. As data centers proliferate in suburban markets, expect to see more municipalities developing specific zoning categories, noise ordinances, and environmental requirements for these facilities. The six-month moratorium requested by NEST would allow Naperville to study impacts and develop comprehensive regulations rather than reacting to individual projects. This approach could become a model for other communities facing similar development pressures, potentially slowing the breakneck pace of data center expansion in some markets.
Broader Market Implications
The challenges facing Karis in Naperville suggest that the easiest sites for data center development may already be taken, forcing developers to navigate more complex community and regulatory landscapes. This could drive up costs and timelines for new projects, potentially constraining supply in key markets just as demand from AI and cloud computing continues to surge. Developers who can successfully navigate these community relations challenges while maintaining competitive pricing may gain significant advantages in what’s becoming an increasingly complex development environment.
