Concept To Build Data Center On Hospital Property Floated Before Blue Island City Council

BLUE ISLAND, IL—Blue Island city officials shared that an investment company has inquired about building a data center on the former Metro South Hospital property, which has raised concerns throughout the community and surrounding area.

The potential data center development was announced at the Blue Island City Council and planning commission meetings last month. City officials said that they had been approached by the New York-based Builders Capital, a construction lender, with a “preliminary concept” for a data center.

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“At this time, the proposal remains in its earliest stages, and no formal plans or applications have been submitted to the city,” Mayor Fred Bilotto said in a message to residents on the city’s Facebook page.

The hospital closed in 2019 because of low usage and financial struggles and since then has become a derelict property. Interest in redeveloping it for medical use or residential development has fallen through. Despite an investment of $20 million to temporarily reopen the hospital during the pandemic to care for critically ill COVID-19 patients, it never came to fruition.

As digital technologies become increasingly enmeshed in our daily lives, the artificial intelligence, or AI, boom requires an especially large amount of computing power, which translates into more energy use. A data center is a physical location that stores computing machines and their related hardware equipment, used to generate such AI applications as ChatGPT and Gemini, and other more complex machine-learned applications.

Blue Island City Administrator Tom Wogan told city council members during their April 14 meeting that the Builders Group currently owns the 550,000-square-foot property at 12935 Gregory St., after calling in a $44 million note.

Wogan said he’s met twice with representatives from Builders Capital, which wants to bring back a plan to financial backers to build a park for a data center. The private construction lending company has already appointed a project manager to handle the project.

“He’s very eager to meet the council,” Wogan added. “I think everyone here, myself included, would have a great deal of questions and concerns.”

He added that he got a much better impression of professionalism from Builder’s Capital than he did from the former developers. Wogan said the group is serious about demolishing the hospital and building a data center.

“They'll present a case that all the problems we’re about data centers—the environmental concerns, the quality of life around them, and the noise—they’re two steps ahead of. Their science and the technology they’re using are so much better than the old technology that is causing all these problems.”

Wogan asked for a “yes, no or maybe” answer to bring to Builder’s Capital.

“We want the council involved at the very early stages of this, because like I said, this is a big deal with a lot of financial pros and cons.”

The project would have to go through the Blue Island planning and zoning commissions to review plans and obtain a special use permit. The project will be sent to the city council along with both commissions’ recommendation to support or not support a data center.

“What I don’t want is any belief in the community that we’re moving this thing along,” Bilotto said. “No one has made up their mind about this. “There will be a healthy community debate before anything like this could happen.”

A special committee of the whole meeting is planned for the near future where the community can ask questions and share concerns.

Data centers are the most hotly debated topic in municipalities across the country. U.S. Sen. Bernie Sanders (D-VT) has called for a national moratorium on the building of data centers, arguing that they will have a profound impact on land and water use and will drive up electricity costs. The City of Denver was the most recent large city to put a moratorium on data centers. Closer to home, a developer withdrew its plans to build a data center in Lisle after public blowback.

Naperville also nixed a data center proposal; on the contrary, the Joliet City Council recently approved a data center project 8-1, despite community opposition.