WEST JORDAN, UTAH — J.P. Morgan and Starwood Property Trust have provided $2 billion in financing for a data center project in West Jordan, located just south of Salt Lake City.
The borrower, a partnership between Los Angeles-based investment firm CIM Group and regional operator Novva Data Centers, will use the proceeds to complete construction of the second and third phases of the latter entity’s 100-acre flagship Salt Lake City campus. At full build-out, the campus will span approximately 1 million square feet and have a total power capacity of 175 megawatts (MW). According to The Wall Street Journal, that is enough electricity to power about 175,000 U.S. homes of average size.
Development of the campus began several years ago, with the first phase coming on line in 2023, the same year in which ownership secured a full-campus lease with an undisclosed global tech company. Construction of Phase II of the project began in December 2023 and will feature a 318,000-square-foot data center building that will have the capacity to produce 72 MW of power. Construction of Phase III commenced in January 2024 and will also feature a 318,000-square-foot data center with a 72-MW capacity. Completion of both facilities is slated for 2026.
Executives from the project team cited the recent growth in AI (artificial intelligence) platforms and applications across a range of industries as a key catalyst behind new development of data center projects, including this one.
“This financing is further validation of the potential we saw in Novva’s proprietary data center design,” says Avi Shemesh, co-founder and principal of CIM Group. “As demand for AI and data center capacity grows, Novva continues to be strongly positioned as one of the most innovative and fastest-growing data center companies in the country, developing sustainable, highly efficient data centers at low cost.”
Other representatives of the ownership team said that certain design and engineering traits of their projects, such as the ability to operate without water year-round and to cool with ambient air, have contributed to successful demand and lease up for their facilities.
“Our Salt Lake City center is the first facility where we were able to fully showcase Novva’s vision for future-proof data center facilities that put sustainability, innovative technology, and client needs first, and we’re proud to continue that legacy with this second and third phase of construction,” says Novva CEO Wes Swenson.
According to a recent report on the asset class from Cushman & Wakefield, overall vacancy within the U.S. data center market fell to about 3 percent toward the end of 2024. In addition, more than 80 percent of new product under construction at that time was already preleased. The report cited AI-led demand as a major driver of growth.
— Taylor Williams