With its central location, extensive transportation and trade systems, and robust economy, Chicago is a hot spot for all industries. It’s no shock that commercial real estate investors and developers flock to the city and its suburbs when searching for the ideal site for corporate facility investment.
In early 2024, we touched on the Windy City’s appeal as a data center development location. Since then, as the artificial intelligence craze and demand for cloud solutions have endured, Chicago’s data center market has also heated up.
Notable Recent Chicago Data Center Construction Projects
In the first few months of 2025, data center developers announced a few substantial projects. Here are some of the recent data center plans that have made headlines. Note: This is not an exhaustive list.
- T5 Data Centers acquired a data center site in Elk Grove Village, IL, according to a March 28, 2025, Data Center Knowledge The article also notes that T5 already has data center campuses in Elk Grove Village and Grayslake, IL, as well as a center under construction in Northlake, IL.
- Compass Datacenters is constructing a five-building data center campus in Hoffman Estates, IL, according to a March 10, 2025, Crain’s Chicago Business article.
- Digital Realty plans to add a data center at 330 E. Cermak Rd. in Chicago, adjacent to its current facility at 350 E. Cermak, as reported by Crain’s.
- In 2024, Microsoft acquired over 500 acres in Plano, IL, for the purpose of constructing a data center, according to Crain’s.
Why Chicago Appeals to Data Center Developers
The Chicago data center market had a 17 percent year-over-year capacity increase in 2024 and is projected to sustain 22 percent growth through 2026, according to the REJournals article “Powering the digital real estate boom: Inside Chicago’s data center construction revolution.”
There are numerous reasons behind Chicago’s status as a magnet for digital infrastructure projects in recent years. Here are some of the top reasons why the Windy City makes sense for data center real estate development.
- Power comes at a lower price in Chicago than in other Tier 1 markets, according to Prime Data Centers.
- Illinois offers tax incentives for data center construction. Operators that meet certain requirements enjoy tax exemptions and credits through the state’s Data Centers Investment Program.
- The Chicago area offers multiple options for high-speed fiber internet, according to HighSpeedInternet.com.
If you want to learn more about Chicago data center real estate development or explore other commercial real estate categories, the Avalon Realty Associates team is here to help. Call 847-506-1000 or email info@avalonreal.com to connect with our real estate experts today.