KCRag Forum

earthling wrote: ↑Fri Mar 11, 2022 7:16 am ^Because the economic impact is high at this scale even if not as clear cut as major direct job growth. Pro development studies can be overstated but even if half claimed, between 3 big KC projects planned likely many $Bs, it's significant.

So it sounds like the only impact is the tax from building the data center? Beyond that...not much?

^Much more than just the construction. Read the entire post and the links. It spells out other sources as well as indirect jobs and ongoing taxes from equipment upgrades over the years. GPTP claims $100B equipment, which seems high but still nothing to sneeze at if a quarter of that as most will be upgraded every 3-5 years long term. Data centers are in constant lifecycle management mode. Is understandable most are used to measuring economic impact by job growth but in this case there's still significant impact outside the direct jobs. One report claiming $1B DC investment is comparable to scoring a 1700 employee HQ (I question those values but probably mostly the case). If DC's were 'not much' other markets wouldn't allow for incentives. MO has been behind the curve until now.

On another note, some more context. The bulk of KC DC market currently uses about 50 MegaWatts. GPTP first phase will be about 200MW to 600MW when all phases complete. For the Rocky Branch Creek tech park across the highway, guesstimating to be about another 200-250MW and the Google DCs at Hunt site could add 200-300MW more.

This could also help kick up KC's gear into a higher tier player in renewable energy as the larger DC players seek renewable sources.

Does this help attract tech jobs here at all?

Yes, and even more economic impact than the direct jobs.

There will be hundreds of direct IT jobs per site and according to one study DCs can drive 5 indirect jobs for every 1 direct, such as vendors. For the big players like Facebook and Google they build some of their own hardware so may not often use commercial networking or servers like Cisco, Dell or HP but still use vendors in some form - maybe a factor of 1-2 additional indirect to 1 direct. A mid-sized DC operator does rely fairly heavily on vendors and probably can drive 3-5 to 1 factor of more local jobs. Servers, storage, networking, monitoring/management tools, etc. so adding local EMC, Cisco, Dell, HP, etc sales and IT support jobs. So it would be good if GPTP and other one across highway could attract mid-sized operators too.

For reference, a Facebook data center in Arizona... $800M, 960K sqft with 1500 initial construction jobs and 100 permanent jobs when operating.

For KC Project Velvet the BizJournal describes 2 buildings at 600K sqft each and second phase of 2 more 600K sqft buildings. So apparently 1.2M sqft feet first phase and 1.2M sqft second phase. May not be final plans. The entire GPTP complex is expected to handle about 13 or so buildings for 6-7M sqft (among largest DC complexes globally). Rocky Branch Creek proposal another 5 buildings and Google complex perhaps equivalent to 6-7 more.

Economic studies by industry shills could overstate things or use rarely attainable optimistic numbers but at this scale there probably isn't a reasonable position to downplay the massiveness of these. Energy consumption was a reason for criticism in past but constantly improving renewables tech now allows for staying on top of it (every few years newer solar panels get more watts per inch and wind-based more watts per rotation, KC needs to focus on hydro power as well given fast moving river). Water consumption another challenge in some markets, but not a problem for KC. BTW, a U of Nebraska study also claims 4+ indirect jobs created for every direct data center job. Three probably an average realistic factor.

(Little bird says Oracle/Twitter looking too)

I'm hearing the Twitter and Oracle rumors as well.

Would expect Co-Location DC providers to also look strongly at KC like Interxion, Equinix, CyrusOne, Digital Reality, etc. They are lesser known names but still major players that possibly bring in more indirect jobs as they likely tend to rely more on external vendors than Google/Facebook/Amazon. Amazon AWS would be the ultimate score for a West Central region but we'd be competing with Denver and Dallas.

earthling wrote: ↑Tue Mar 15, 2022 10:45 am Would expect Co-Location DC providers to also look strongly at KC like Interxion, Equinix, CyrusOne, Digital Reality, etc. They are lesser known names but still major players that possibly bring in more indirect jobs as they likely tend to rely more on external vendors than Google/Facebook/Amazon. Amazon AWS would be the ultimate score for a West Central region but we'd be competing with Denver and Dallas.

While they're bigger markets, I wonder if the momentum we have in DC would give us the advantage. As more locations come online and become occupied it almost acts as a community of DC's, almost like a Silicon Valley or Austin; albeit a different field, but similar in it's job attraction to a specific area.

^If you're referring to AWS it seems DC site selection is mostly heavily weighted on incentives. KC is in a better technical/logistical position than Iowa for data centers yet they gained many DCs from Big Tech over last decade+ due to state incentives. MO was late to the game with incentives. So my guess is that if AWS decides to build a central west region, it may go to the state with best incentives. Otherwise KC, Denver and Dallas in addition to incentives seem to have best logistical advantages including pretty much every major and minor longhaul Internet carrier.

The exciting thing about data centers is that KCMO is uniquely positioned for these. SPP provides us cheap, green energy that DCs demand. KC is a much more attractive location for hiring and ,at least as I understand it, better located along long distance lines than Nebraska and Iowa.

Kansas doesn’t have the same incentives and these projects are less susceptible to getting poached every 15 years. St. Louis is in a different power pool with higher costs and less green energy that put a significant damper on their potential.

Railroads are notorious for paying minimal taxes but their presence is what made KC and their absence which broke St. Joseph. Data Centers and data lines may not be exciting on the surface but they have the potential for significant spin off. Earthling can pull 1,000 stats that show their economic benefits but it’s important to think about what this unlocks for the future.

normalthings wrote: ↑Wed Mar 16, 2022 10:05 pm Kansas doesn’t have the same incentives and these projects are less susceptible to getting poached every 15 years.

The permanency of data centers is another good point, swapping most jobs for equipment generating taxes. Jobs can easily move, especially in this era of remote working, but data centers stay put and are constantly re-invested within, given major equipment upgrades every few+ years, which will continue generating significant local taxes for the life of the building as a data center, especially after the period of incentives is over. I suspect the $100B equipment claimed by GPTP accounts for upgrades during incentives period but is not clear.

daGOAT wrote: ↑Tue Mar 15, 2022 8:42 am I'm hearing the Twitter and Oracle rumors as well.

Oracle owns Cerner, which means they already have data centers in KC.

^Not yet. They target to close acquisition by June otherwise maybe end of year.

Sounds like Oracle plans to migrate Cerner apps to Oracle platforms so will likely eventually move everything to Oracle Cloud data centers. So one of two likely things to happen... they eventually shutdown the Cerner data centers in KC or convert to general use Oracle Cloud DCs (not just for Cerner). The City should restructure the Bannister site incentives deal for general Oracle Cloud DCs rather than more offices and entice Oracle Health division to mostly move downtown, starting with W&R and/or Strata if not building their own at say 7th/Main open lots.

I would give away that entire Bannister Cerner park if we could move even a quarter of it to downtown.

Meta, Facebook’s parent company, plans to invest $800 million in a 1 million-square-foot data center.

Nothing really new, just the official announcement...
https://www.kansascity.com/news/busines ... 97110.html

Yep the Meta data center stuff. Just politicians patting themselves on the back type of press conference.

dukuboy1 wrote: ↑Thu Mar 24, 2022 9:22 am Yep the Meta data center stuff. Just politicians patting themselves on the back type of press conference.

Its a "mega" project by KC standards, Worthy of an announcement

You guys seem really unenthused about this announcement, even if you knew it was coming.

It's a biggy, simply no new information we didn't already have.

Time to bring on Tenant Number 2.