Indiana: Gateway For Data Center Growth

Southern Indiana is poised to get a bigger share of the expanding North American data center market, which is expected to grow to $101 billion by 2026.


https://businessfacilities.com/2021/09/indiana-gateway-for-data-center-growth/
Southern Indiana is poised to get a bigger share of the expanding North American data center market, which is expected to grow to $101 billion by 2026.
Facebooktwitterredditpinterestlinkedintumblrmail

Indiana: Gateway For Data Center Growth

Southern Indiana is poised to get a bigger share of the expanding North American data center market, which is expected to grow to $101 billion by 2026.

Indiana: Gateway For Data Center Growth

By the BF Staff
From the July/August 2021 Issue

In an age of digital learning, digital workplaces, digital shopping and digital entertainment, it’s no wonder the demand for data centers keeps growing.

Globally, the data center market is expected to grow at a compound annual growth rate (CAGR) of 4.5 percent between 2021 and 2026, reaching annual revenues of more than $251 billion, according to a recent report published by Arizton, a market research firm. The North American data center market alone is expected to reach $101 billion by 2026, growing at a CAGR of more than 3 percent. Furthermore, the market research firm predicts growth in the 5G network is likely to increase demand for edge computing.

Indiana data center
Sunrise on Ohio River near NorthPort Business Centre (Photo: Hoosier Energy)

The logistics and manufacturing region in southern Indiana is geographically positioned to take advantage of these growth opportunities.

“If the last year taught us anything, it’s how much the world relies on the digital marketplace to manage the business of business,” says Wendy Dant Chesser, president of One Southern Indiana, the chamber of commerce and local development organization for the Indiana metro region adjacent to Louisville, Kentucky.

Indiana’s aggressive tax incentives for data center development were just the catalyst local economic development leaders and electric providers needed to showcase the area’s capacity for growth in the digital age.

Hoosier Energy, a 70-year-old electric cooperative with a long history of partnering with its 18-member distribution systems and local economic development leaders to land multi-million-dollar projects for prodigious energy users, contacted a top-ranked national consulting firm to conduct a data center feasibility study for a 104-acre site in Jeffersonville, IN—located a stone’s throw across the Ohio River from Louisville’s booming air and ground hubs.

“We felt we had the capacity in place to attract a data center in our own backyard,” said David Vince, General Manager of Clark County REMC and a member/owner of Hoosier Energy. “It’s not just a piece of land. Everything is there—long haul fiber, electric transmission and capacity, roads, water and sewer.”

The detailed study conducted by Infrastructure Ready LLC, JCL Consulting Engineering and Grella Partnership Strategies (GPS), confirmed what Clark County REMC suspected. NorthPort has the assets and attributes sought after by mission critical data center operations, including highly reliable and redundant power, water and fiber infrastructure; competitive cost structures; options for renewable energy delivery; and a scalable location. The proposed master plan development includes a maximum of five buildings, scalable to accommodate up to 215 MW total load.

“NorthPort is very well positioned regionally in terms of connectivity to four of the top U.S. data center clusters in the country—Chicago, Columbus, Ohio, Atlanta and Northern Virginia,” said Mike Grella, owner and CEO of GPS, a national leader in data center site selection and economic development advisory. “It makes a lot of sense for an edge facility to land right outside of Louisville—it’s so centrally located.”

Sitting 10 miles from Louisville, KY; 75 miles from Cincinnati, OH; and 100 miles from Indianapolis, NorthPort can physically accommodate multiple data center facilities, a use that is legally permissible given applicable zoning ordinances, and does not indicate major financial feasibility impediments, according to the report.

As manufacturers and logistics firms increasingly rely upon Internet of Things (IoT) applications and cloud-based technologies to stay competitive, the need for edge computing and disaster recovery data centers are becoming standard operating procedure rather than optional.

“In our internet driven economy, companies absolutely need a backup—a secondary location that can be spun-up quickly and get data and applications back online instantaneously,” said Grella, whose extensive experience in distribution, logistics and information technology includes a seven-year tenure as former head of global economic development for Amazon. “NorthPort is in an ideal area to serve these functions. It’s on a different electric grid from hyperscale campuses, located far enough away from what security professionals and insurance underwriters consider ‘the blast radius,’ yet close enough to major Midwest metro areas to ensure business continuity.”

Meeting the high bar necessary for data center feasibility means the site is also well suited for light manufacturing and logistics enterprises—the bread and butter of the region.

“Such versatility is attractive to niche players,” added Vince, “especially those who need to get up and running quickly. Anyone can have a plot of land, but it’s speed to market that counts.”

The NorthPort local team is ready.

“A community’s ability to engage leaders who work together must be genuine and visible to prospects,” Grella added. “The strong and seamless collaboration that Hoosier Energy, Clark County REMC and One Southern Indiana have is very evident. Collectively, this ‘all-star’ team of utility and economic development professionals has the expertise and resources to deliver critical infrastructure at the request of any customer. They are eager, nimble, creative and smart. NorthPort has the people to make it happen, and happen quickly.”

Vince agreed. “As a cooperative, we’re local and we have extensive experience working with large energy users. We don’t have project managers jumping through bureaucratic hoops before anything gets done. We’re here and ready to rock and roll.”

BUSINESS IS ROARING BACK IN SEYMOUR-JACKSON COUNTY

Business is strong throughout South Central Indiana, and as Jackson County Industrial Development Corporation (JCIDC) celebrates its 37th anniversary, industries are investing and growing.

“Coming out of COVID-19, we assumed that business and industry would come roaring back … and they certainly have,” said Jim Plump, who has served as executive director of the Seymour, IN-based organization since its inception in 1984. “Advanced manufacturing and logistics are the lifeblood of our region, and we are certainly seeing growth in both of those sectors.”

Indiana data center
This 60,000-square-foot spec building (expandable to 120,000 square feet) located in Seymour’s East Side Industrial Park is for sale or lease, offers I-65 visibility and includes two truck docks and one overhead door. (Photo: Rob Millman, Millman Realty Partners)

In Seymour, two tier one automotive suppliers have announced investment of over $75 million through the first half of 2021 as Japan-based Aisin U.S.A. Manufacturing and Valeo North America are making significant investments. In addition, Cummins also continues its growth in Seymour and throughout the region.

“Our location and transportation system have always been two key elements of our marketing, and that remains true today. It used to be ‘location, location, location’ … and to a certain extent, it still is,” says Plump. “However, we realized long ago that the labor force both today and tomorrow are keys if we are to continue to grow. So, in concert with ‘location’, it’s now ‘workforce, workforce, workforce’ and we have been focused on that for over two decades with our JCIDC Workforce Partnership.”

With more than 30 percent of the region’s workforce involved in manufacturing, the Workforce Partnership was created under the umbrella of JCIDC in 1998, and is supported by numerous industries and other partners to better prepare the current and future workforce. The group helps facilitate a number of programs for middle school and high school students, plus post-secondary and the incumbent workforce.

“When several of our industries were considering major expansions, they became even more involved in the program,” said Plump. “They, obviously, needed to know that the workforce would be there for years to come.”

Seymour-Jackson County is located along Interstate 65 and is one hour south of Indianapolis, IN; an hour north of Louisville, KY; and 90 minutes west of Cincinnati, OH, and was a founding member of the South Central Indiana regional marketing group formed in 2002.

JCIDC currently is promoting a new 60,000-square-foot shell building that is expandable to over 120,000 square feet, and is located at Seymour’s East Side Industrial Park. In addition, the organization is marketing greenfield sites at the East Side Park, which is located adjacent to Interstate 65 and CSX rail. Also, JCIDC is marketing new industrial sites in Crothersville, which is located in southern Jackson County, 36 miles north of Louisville.

AFFINITY PLACES HQ IN RIVER RIDGE

Representatives of One Southern Indiana (1si) and Affinity, a uniform, professional workwear and safety garment manufacturer and distributor, announced its plan to move its U.S. headquarters, manufacturing facility and distribution center to an America Place property within the River Ridge Commerce Center. The $3.9 million project would create 160 new jobs with pay averaging 32 percent above the Clark County average wage, and include the lease of a 100,000-square-foot building, with some customization to the space, new computer hardware and software.

“Affinity is a growing, stable company that is delighted to bring a state-of-the-art distribution center to Indiana,” said Senior Vice President Gregg Mischner. “Affinity is part of the Mi Hub family of brands and this development allows the group to expand its global footprint and better service our clients with faster shipping anywhere to the U.S. and around the world. This new location gives Affinity the opportunity to fully focus on the corporate apparel and PPE marketplace, to become the industry’s leading provider within the mid-market sector in North America.”

Jeffersonville, IN, Mayor Mike Moore said, “I am proud Jeffersonville continues to attract companies like Affinity from around the globe to its business-friendly, world-class amenities, and we stand ready to assist in any way possible. The city will continue to improve its infrastructure, quality of place and many other assets to ensure it remains competitive with any location in the United States as the best place to start a new business venture.”

The Indiana Economic Development Corporation (IEDC) offered Affinity up to $1.7 million in conditional tax credits based on the company’s job creation plans, along with training assistance up to $100,000. These tax credits are performance-based, meaning the company is eligible to claim incentives once Hoosiers are hired.

“Indiana’s business-friendly environment, skilled talent pipeline and strong manufacturing sector offer companies like Affinity the perfect location to establish and grow their footprint,” said Governor Eric J. Holcomb. “We’re extremely grateful that with 49 other states to choose from, Affinity picked Indiana to establish its new home and create quality career opportunities for Hoosiers for years to come.”

The location of the new company is 401 Salem Road in the River Ridge Commerce Center, a 6,000-acre business and manufacturing park of the highest caliber under development along the Ohio River, across from Louisville, KY. Recently, the River Ridge Commerce Center reported increased employment, expanded development and generated an increase of $2.5 billion in economic output in 2020 alone—the largest output from the business park since it opened.

“The River Ridge Development Authority is pleased to welcome the latest international company, Affinity, to the River Ridge Commerce Center in Southern Indiana,” said Jerry Acy, Executive Director of the River Ridge Development Authority. “We look forward to working with them and establishing a long-lasting partnership as they grow with us here in Jeffersonville, Indiana. Affinity is making a major commitment by bringing manufacturing, distribution and the company’s new U.S. headquarters to Southern Indiana. I want to compliment Affinity and the dedicated group of partners that worked to bring them here, including the IEDC, One Southern Indiana, America Place and our team at River Ridge.”

Wendy Dant Chesser, president and CEO of 1si, said, “Affinity is a great addition to the River Ridge Commerce Center and Southern Indiana business community. 1si’s economic development efforts are focused on attracting and supporting diverse industry in order to mitigate fluctuations in any one industry, as well as increasing the average wages of Clark and Floyd county workers to ensure a better quality of life. We look forward to working with company leaders to ensure they have the tools needed to work towards success, now and in the future.”

NEW PARTNERSHIP WITH OMNITRAX

The River Ridge Development Authority (RRDA) has reached a partnership agreement with OmniTRAX, one of the fastest-growing private railroad and transportation-management companies in North America. Under the new agreement, the Denver-based company will further develop the RRDA’s rail infrastructure at the River Ridge Commerce Center. Additionally, OmniTRAX will work closely with River Ridge staff and local partners to attract major employers and new industries to Southern Indiana.

“Proper infrastructure and connectivity across urban and rural areas is essential for economic growth,” said Interim Indiana Secretary of Commerce Jim Staton. “The state’s business friendly environment, tremendous workforce and significant rail traffic are among the top reasons rail companies are choosing to expand their businesses in Indiana.”

“OmniTRAX is a well-respected railroad operator and transportation company that will be a great partner as we continue to take River Ridge to the next level,” said River Ridge Executive Director Jerry Acy. “River Ridge and the entire region will benefit from its depth of resources, strong rail and logistics expertise, and national economic development network. This new partnership will open up the Commerce Center for new and expanded development and bring new jobs to our community.”

“Nationwide, our customers place high value on strategic locations and collaborative local partners, and the River Ridge Commerce Center delivers both,” said OmniTRAX CEO Dean Piacente. “We are excited the park’s leadership and local officials selected OmniTRAX to help transform the community, and we are eager to get to work.”

The River Ridge Commerce Center has become one of the nation’s premier business and industrial parks. River Ridge is an economic driver for the region, attracting top-tier employers and well-paying jobs to the community. River Ridge is home to more than 60 firms with over 10,500 workers.

With about 4,000 acres of River Ridge still available for development, River Ridge can accommodate projects ranging from 1 acre to 1,400 acres in its dedicated megasite. River Ridge’s central location and world-class amenities make it a preferred site for dozens of companies, representing sectors such as aerospace, automotive, food and beverage, information technology, life sciences and logistics.

OmniTRAX, an affiliate of The Broe Group, operates more than 20 rail systems in North America and offers transportation and supply-chain management solutions. Its new agreement with River Ridge will allow the company to connect existing customers and new prospects with a centralized hub that will serve the Midwest, Northeast and Southeast markets.

River Ridge’s rail system connects directly with CSX Railroad and rail connections to the entire country. With its location along the Ohio River, it is also easily accessible by almost every form of transportation, and lies within minutes of four interstates (I-71, I-64, I-65 and I-265), Louisville Muhammad Ali International Airport and the Port of Indiana-Jeffersonville. It is within a day’s drive of two-thirds of the U.S. population.

“OmniTRAX and CSX have a proven history of rail carload growth in the eastern United States,” said CSX Senior Vice President of Marketing Farrukh Bezar. “OmniTRAX’s hyper local rail development focus, coupled with the reach of the CSX franchise, is a valuable rail differentiator for the River Ridge Commerce Center and the surrounding communities who will benefit from new, higher-paying jobs as a result.”

Want to learn more about doing business in Indiana?

Check out all the latest news related to Indiana economic development, corporate relocation, corporate expansion and site selection.

Suggested Links:

LEAVE A REPLY