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Land & Economics

Site Selection

Why is farmland more valuable than old factories for data centers? Land cost is less than 1% of project cost, yet greenfield sites beat brownfield despite policy goals.

4 min read

Key Takeaways

  • 1 Land is <1% of project cost—developers optimize for risk and timeline, not price
  • 2 Brownfield barriers: contamination liability, 2-4 year remediation delays
  • 3 Transmission proximity is the #1 factor—corridors run through farmland

The Farmland Paradox

Meta, Google, Microsoft, Amazon—they all choose cornfields over closed factories. Why pay to demolish farms when contaminated industrial sites are cheaper with government support?

Brownfield

Former Industrial

🏭

Lower price, government incentives, but...

Greenfield

Agricultural Land

🌾

Clean title, predictable timeline

Land Cost: The Irrelevant Factor

Saline Township, Michigan
$8M
land cost
$7B
project cost
0.11%
land as % of total
Where the Money Goes
IT Equipment 50-60%
Building 15-20%
Power Infrastructure 10-15%
Cooling 5-8%
Land <1%

Why Brownfield Fails

Three compounding problems make former industrial sites unattractive despite lower prices.

Liability

CERCLA: Owner liable for cleanup regardless of who contaminated

Deal-killer for institutional investors

Timeline

18-36 months remediation before construction starts

Surprise contamination stops work

Power Gap

1960s factory: 20-50 MW. Data center: 1,000 MW

20-50x capacity gap

Greenfield
Phase I
Construction
2-3 years
Brownfield
ESA
Remediation
Build
4-6 years

The Real Deciding Factor: Grid Access

Land cost is irrelevant. Contamination risk matters. But transmission proximity dominates all other factors.

2-5 miles to 345kV substation
=
Viable project economics

Transmission corridors bypass cities

High-voltage lines connect power plants to load centers—running through rural farmland, not urban brownfields.

Why Incentives Don't Work

Michigan's Brownfield Incentive
11 mo
extra tax exemption
~$40M
incentive value
$500M+
delay cost (2 years)

When land is <1% of cost, financial incentives cannot overcome structural disadvantages. The market systematically produces outcomes policy tries to prevent.

Go Deeper

Chapter 7 of This Is Server Country explores the Saline Township case study in detail—how site selection decisions ripple through communities, why traditional industrial recruitment fails, and what alternative policy frameworks might better align market incentives with public goals.

Learn more about the book →