Articles

Hillsboro, Ore., Becoming Regional Hub for Data Centers

The state exempts data centers from local property taxes, covering the facilities' largest operating costs.

by Mike Rogoway, The Oregonian / November 24, 2015

(TNS) — LinkedIn plans to open its third U.S. data center next year in Hillsboro, joining a broad influx capitalizing on local property tax exemptions.

The career networking site already has two data centers in the United States and a facility overseas, but LinkedIn says its data center needs have gone up 34 percent over the past year. So it's putting its next facility in Hillsboro by leasing space inside an existing data center owned by Infomart, within a former semiconductor equipment factory, and building an additional facility on the property.

The 8-megawatt project will come online late next year. LinkedIn says it will transfer a "small number" of employees from other sites to operate its Hillsboro facility.

LinkedIn says it chose Hillsboro because there is direct access to green power and intercontinental communications networks, mild temperatures for cooling its computers and local tax incentives.

Taxes would be, by far, data centers' largest operating cost, but Oregon and many other states exempt them from local property taxes – even though data centers are not major employers.

Infomart is among multiple data centers in Hillsboro, most of which rent out space to other companies that need computing power or storage. Others include Adobe, Digital Realty Trust/Net App, ViaWest and T5 Data Centers.

All those facilities are in enterprise zones that exempt them from the property taxes that most businesses pay on their equipment. That can save the data centers or their clients millions of dollars annually and have made Oregon one of the most attractive destinations for data centers in the country.

Hillsboro is developing an urban renewal plan that will convert farmland for industrial development – and, the city forecasts, about 1.2-million-square-feet of additional data centers.

©2015 The Oregonian (Portland, Ore.), Distributed by Tribune Content Agency, LLC.