The estimated economic scope of the Quality Technology Services (QTS) data center project in southwest Cedar Rapids continues to grow.
Scott Mather, the city’s economic development coordinator, presented amended and restated development agreements for the QTS data centers to the Cedar Rapids City Council Tuesday, Dec. 2, noting that while the minimum investment in the sprawling project remains $750 million as previously stated, the company’s anticipated total investment in the project is now $1.75 billion.
“We believe it’ll be more than that,” Mr. Mather told the council.
Mr. Mather said the overall plan now involves the construction of a data campus in up to seven phases, with each phase totaling an investment of $250 million. Earlier estimates indicated the project would include “two or more phases,” Mr. Mather said.
Each phase will still involve a minimum 300,000-square-foot data center.
The main reason for the amended agreement, Mr. Mather said, is due to QTS’ organizational structure, under which each phase will have “related property owners” as parties to the overall agreement, similar to QTS Cedar Rapids I LLC as the owner of the first phase.
“Each building will have its own property owner, and as such, they needed to be added to the agreement,” Mr. Mather said.
Each phase will still include a minimum of 15 permanent jobs, all at or above the high-quality jobs pay threshold. Mr. Mather said the project will now require a minimum of 1,200 construction jobs, up substantially from the estimated 500 construction jobs when the council approved the first QTS development agreement in January.
The first phases of the project is already under construction at 6200 76th Avenue SW, in part of a 1,391-acre commercial park owned by Alliant Energy.
A QTS spokesperson said in July that the first phase of the project was expected to be completed in late 2026. The second phase is expected to be completed in late 2027.
Other city financial incentives remain the same, Mr. Mather said. QTS will receive a 20-year, 70% property tax rebate per project phase. The larger overall scope, however, means that the project will generate an estimated $2 billion in property taxes over the applicable rebate periods, up to $1 billion of which will be rebated to QTS.
The project also includes a 20-year, 75% rebate of electrical franchise fees collected by the city through Alliant Energy for each project phase.
The agreement also continues to require the establishment of a community betterment fund for economic development activities in Cedar Rapids, including amenities and infrastructure. QTS will contribute $300,000 annually, per project phase, to the fund, with a maximum of $6 million per project phase and $18 million overall.
The council voted unanimously to approve the revised development agreement.
QTS officials have previously said the Cedar Rapids data center project will comprise an overall investment of $10 billion over the course of its development, placing it among the largest economic development initiatives in Iowa’s history and the largest in the history of Cedar Rapids.
