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Microsoft Plans $500M Illinois Data Center

Microsoft will be the tenant in a huge data center in Northlake, Ill., which was announced in May as a speculative project.

Remember that huge data center being built on spec in Northlake, Illinois? Microsoft will be the tenant, according to local media reports. The huge data center project, announced at 441,000 square feet, continues Microsoft's expansion of its Internet infrastructure as it battles Google (GOOG) and other major competitors in web-based services.

The new facility in Northlake, a Chicago suburb, is expected to cost more than $500 million, according to Crain's Chicago business, which said that Turner Construction is managing the project for developers Ascent Corp. and The Koman Group. Turner would not comment to Crain's, but was the project manager for Microsoft's other recent data center construction projects. Microsoft (MSFT) opened a 470,000 square foot data center in Quincy, Washington earlier this year, and is building a similar $550 million facility in San Antonio. Media report indicate that Microsoft has also submitted plans for $500 million data center campus in Dublin, Ireland

Koman and Ascent announced in May that they would begin building a huge data center but had not yet lined up tenants. The initial specs for the facility were to include 40 megawatts of power available at 5 cents a kilowatt hour, with a dedicated substation on the 12-acre property.

Microsoft has been keenly focused on power costs in its data center site location efforts. While 5 cents per kilowatt hour is in the midrange of average state-by-state power costs, it is lower than rates found near many major data center markets such as California (9 cents per kWh) or northern New Jersey (11 center per kWh). Microsoft's data center in Quincy runs on hyrdro power that costs less than 2 centers per kilowatt hour, while San Antonio has the cheapest power in Texas, which is a favored location for data center development because it has its own power grid.

Ascent has managed more than $950 million in large-scale projects and 3 million square feet of mission critical facilities in North America and Great Britain. The Koman Group has developed over $900 million in new projects in the St. Louis and the surrounding area over the past 15 years.