Year in Review: Data Centers, DC United Deal Deliver Economic Development Wins

During 2018, the competition for Amazon’s HQ2 headquarters project dominated the business headlines. While a Loudoun-based proposal made it to the final rounds in that selection process, it was Crystal City and New York that won sweepstakes.

Even without landing that project, it was still a banner year for Loudoun’s economic development team.

The data center industry opened the year in controversy as the Board of Supervisors approved construction of the 750,000-square-foot True North data center complex on 106 wooded acres along Goose Creek and south of the Dulles Greenway over the objections of environmental groups.

That action was followed by a year-long land rush on other vacant tracts by data center developers looking for construction locations in—or somewhere close to—Loudoun’s famed Data Center Alley as the rapid expansion of cloud computing drives the industry’s growth.

Three major deals transformed the industry landscape during the year. Those involve more than 1,000 acres that sold for $392 million combined.

In July, New York-based Sentinel Data Centers paid $82.5 for 280 acres on the northern edge of Dulles Airport. The land, once envisioned for an “International City” development with a mix of office parks and high-rise homes, is adjacent to the Loudoun Gateway metro station.

In September, the Metropolitan Washington Airports Authority sold 424 acres on the western edge of Dulles Airport to Digital Realty Trust L.P. for $236.5 million. Starting in 2005, the airports authority bought land to the west of the airport for a fourth runway and support facilities, a total of 854 acres. In 2017, the authority started the process of seeking organizations to buy or lease property that wouldn’t be needed for airport uses. Digital Realty was the highest bidder.

A few weeks later, Microsoft Corp. closed a deal to purchase 332 acres on the west side of Leesburg Executive Airport from the Petersen Companies for $73 million. The Compass Creek property is a 550-acre tract approved for construction of 2.5 million square feet of office space, 550,000 square feet of retail, 300,000 square feet of flex-industrial uses and a hotel. Already approved on the property is the 100,000-square-foot center ION International Training Center, which is under construction, and a Super Walmart. For now, the Microsoft tract is outside Leesburg’s corporate limits, but the Town Council already is exploring annexation of that land.

Another deal to win accolades is the Board of Supervisors’ approval of a plan to bring a second major league sports franchise to the county, joining the Washington Redskins.

The Board of Supervisors in September gave final approval to a $15 million agreement that cleared the path to put in a 500-space parking lot, a 300-space commuter lot, four FIFA-standard soccer fields, D.C. United’s new headquarters and offices, and a 5,000-seat stadium for a new second-division professional soccer team, Loudoun United, at Bolen Park south of Leesburg. The county will take out $15 million in financing to build the project, which the team will pay back over a 30-year lease. The county will own the stadium and fields, and could also take in tax revenues from alcohol sales, admission taxes, or paid parking.

The team will compete in the 33-team United Soccer League and play its first seven games on the road, starting March 7 in Nashville, but hopes to have the work complete by its home opener May 3 against Bethlehem Steel FC.

The project was named Deal of the Year by the local chapter of Commercial Real Estate Women, but also drove a wedge between Loudoun County and the Town of Leesburg. Residents in neighboring Kincaid Forest, and town councilmembers, have opposed opening Kincaid Boulevard, which runs through their neighborhood but ends in a barricade at Crosstrial Boulevard, to through traffic. It would be one of the major connections to Bolen Park, linking it to Battlefield Parkway via Crosstrails Boulevard.

One thought on “Year in Review: Data Centers, DC United Deal Deliver Economic Development Wins

  • 2019-01-02 at 6:12 pm

    I look forward to a smart aggressive LN reporter digging into the actual costs to Loudoun taxpayers for the vaunted, it was so good we kept it a secret, best eveh’ in the universe, soccer stadium boondoggle, er, I mean deal. We, as taxpayers deserve it.

    Give ya’ a hint… think 50 million plus when it’s said and done.

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