Grayslake Data Center Gets First Permit In $18B Development

GRAYSLAKE, IL — The village of Grayslake has issued the first building permit for a facility at the T5 campus on the Cornerstone property along Peterson Road, marking the start of an anticipated $18 billion private development.

The initial structure will span 800,000 square feet, with site work set to begin immediately, according to the village.

The approved campus is planned for 473 acres and currently calls for 11 buildings totaling 6.75 million square feet. The village says the current plan represents a 33% reduction in total building space compared with earlier plans.

What makes the project particularly notable for Grayslake, village officials said, is that the development is moving forward without municipal tax incentives, tax exemptions or TIF subsidies.

The village estimates the development will generate approximately $1.4 billion in non-homeowner property tax revenue for local taxing districts during its first 20 years. After 20 years, the village estimates the buildings could generate nearly $100 million annually in combined property tax revenue.

Village officials also said Grayslake will enter the development with an unusual financial advantage: The village has no municipal debt and operates with a balanced budget.

That means, new municipal revenue from the development won't be needed to pay down existing debt or cover past obligations, Mayor Elizabeth Davies said.

“Because Grayslake is debt-free, operates on a balanced budget, and gave no money to the developer, we are in a truly unique position,” Davies said.

Davies said the additional revenue could eventually be returned to residents or used for major community projects, including downtown improvements, expanded trails and open space, infrastructure upgrades and a potential community recreation center. The village also is considering annual direct payments to Grayslake households from utility tax revenue, according to village officials.

The project is also expected to generate significant employment. The village estimates 750 to 1,000 construction jobs per year during the multiyear development, followed by approximately 1,200 to 1,600 operations jobs if the planned campus is fully built.

Construction of the data centers is expected to occur over seven to 10 years.

T5 CEO: Project will incorporate community input

Pete Marin, CEO and chairman of T5 Data Centers, called the permit a milestone for the Cornerstone development and said the company intends to incorporate community input as the project moves forward.

“The Grayslake community has asked many questions about this project and we’re committed to answering them,” Marin said. “We also want to make sure we incorporate extensive community input.”

Marin pointed to the company's recent decision to voluntarily withdraw its application to remediate local wetlands after hearing from residents.

The village's FAQ says the developer had applied to replace 16 acres of isolated wetlands elsewhere but later halted that application after the village urged the developer to change course.

Marin also said T5 has been working with the village on standards and accountability measures related to sound mitigation, water use and electricity use.

“We're grateful to the village for a rigorous approval process, and we're looking forward to being a good neighbor as this project moves forward,” Marin said.

Water, electricity and environmental concerns

Village officials emphasized that the data centers will be subject to local, state and federal requirements governing issues including sound, stormwater, lighting, sewer discharges, air emissions and water use.

The village says the campus will use closed-loop cooling systems rather than older cooling technology that can require substantial amounts of water.

According to the village, an average data center building will use approximately 2,500 to 3,500 gallons of water per day. The entire planned 6.75-million-square-foot campus is expected to use approximately 50,000 gallons per day, which the village says represents a small fraction of Grayslake's overall daily water supply.

The developer also will pay for the electrical infrastructure needed to serve the campus, including an electrical substation on the property, according to the village.

The project has faced opposition and a lawsuit challenging the village's approvals. Residents and a corporation filed a lawsuit in July seeking to invalidate the approvals and block further permits for the campus.

The environmental concerns have included wetlands on the property. According to the village, the developer had applied to replace 16 acres of isolated wetlands elsewhere but later halted that application after the village urged the developer to change course. T5 also announced in August that it had suspended its wetlands permit application.

Village officials said the first permit does not eliminate ongoing oversight.

“By no means is this permit a blank check,” officials said, emphasizing that environmental responsibility will remain a priority as Grayslake grows.

The village says the data center buildings will be designed to resemble larger office buildings and will be subject to architectural, landscaping, signage and lighting requirements.

More via the village's FAQ on the development project.