In DuPage, office vacancies remain elevated while industrial demand and data centers reshape the market.
In this episode of DuPage Business Beat, host Greg Bedalov sits down with Jim Adler and Mark Moran, Executive Vice Presidents at NAI Hiffman, to discuss what is happening across Chicagoland’s commercial real estate market. Suburban offices continue to face high vacancy and limited new investment, while industrial properties remain comparatively stable. Growing demand for data centers, driven by AI growth and power availability, is influencing new development decisions across the region.
Greg and his guests dive in and discuss capital markets, office supply challenges, rent trends, and property repositioning strategies. They also examine whether current conditions reflect a typical real estate cycle or a longer-term shift in workplace demand and location strategy across Chicagoland.
To keep up with what’s happening in DuPage County and the Chicagoland region, follow Choose DuPage on social media or visit ChooseDuPage.com/Ready.
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For those interested in economic development, few things are more frustrating than untapped potential. For Carol Stream, a community known for its thriving industrial sector, the epitome of untapped potential was, until recently, an abandoned property that sat vacant for nearly a decade.
Once the site of a sprawling chemical plant—complete with a production facility, a warehouse, and an R&D laboratory—the property was abandoned in the early 2010s. At the time, many in the community assumed that a buyer would soon come along. Yes, the property needed work; the buildings had to be demolished, and the soil remediated. But then again, it was 11 acres at the heart of central DuPage, in a community with one of the region’s highest industrial concentrations. Of course it would sell.
But then, it didn’t. Nearly ten years passed, and nothing happened. Occasionally, a developer would express interest, then pull back. The longer the property sat vacant, the less appealing it seemed—between its boarded-up windows and faded 1970s aesthetic, what had once been a community showpiece was on its way to becoming an eyesore.
Then, within the past few years, the story took an unexpected turn. A developer acquired the property; the aging chemical plant was demolished; the soil was remediated; and a buyer, Oppidan, purchased the land. Now, construction is underway on a 90,000-SF data center—the first of its kind in Carol Stream. What was once an eyesore is on its way back to becoming a showpiece, and possibly an inspiration for further development.
“This is our first data center,” says Don Bastian, Community Development Director at the Village of Carol Stream. “We have manufacturing businesses, distribution warehouses, logistics facilities, food processing operations, and steel fabricators. But this is the first time we’ve welcomed a data center into our diverse business community.
“And to see the land, this land that sat unused for years, being redeveloped with a modern building and new landscaping—we’re very excited about it.”
For the community, this is a good ending to what was becoming a long and drawn-out story. For the rest of Chicagoland, however, this is only the latest development in a story that’s just begun: the rise of a new generation of data centers.
A rendering shows an overhead view of CyrusOne’s planned Wood Dale campus. The site, which is expected to be complete by 2032, will feature six data centers and about 1.4 million-SF of facility space.
Data 2.0
Data centers are nothing new; in fact, their roots stretch back to the 1940s, when a single computer could fill an entire warehouse. But now, due to rising consumer usage and more data-intensive technologies—from state-of-the-art quantum computers to your iPhone’s “Genmojis”—the demand for data is quickly rising. And the demand for data centers is rising with it.
According to an industry profile from the Greater Chicagoland Economic Partnership (GCEP), within the past four years, the size of the U.S. colocation data center market has doubled. (“Colocation” refers to facilities that rent space where businesses can house their servers.) Think about that: Four years ago, in 2021, we were using a not-small quantity of data. Since then, the market, or at least a significant measure of its footprint, has doubled. It’s not showing any signs of slowing down, either. As of 2024, AI-related data represented about 20% of new demand. As the technology scales up, so will the need for storage capacity.
To account for this rising demand, data centers are cropping up all over the nation, including right here in DuPage County.
In Carol Stream, the previously mentioned 90,000-SF Oppidan data center is set to open in 2026.
In Itasca, Japanese company NTT DATA has recently purchased two office buildings; it plans to demolish them to make space for a cloud storage facility. This will be the fourth of its data centers at Hamilton Lakes, a sprawling corporate campus that historically focused on office and hotel space.
In Wood Dale, development is underway on a new CyrusOne location, West of Route 83, between Bryn Mawr Avenue and Foster Avenue. The site will house six data centers, for an aggregate footprint of about 1.4 million-SF. That’s a lot of server space.
But will it be enough? Probably not. To keep pace with demand, businesses must exponentially increase their data storage capacity, which means they’re going to have to build more data centers. To do that, they’re going to have to find The Goldilocks Zone.
A rendering shows NTT DATA’s planned cloud storage facility at Hamilton Lakes corporate park in Itasca, IL. Hamilton Lakes historically focused on office and hotel space; recently, however, the development has pivoted to welcome data centers.
The Goldilocks Zone: What Makes Chicagoland ‘Just Right’ for Data Centers?
It’s an unfortunate fact of life that you can’t just build a data center anywhere. Servers are fickle. Their cargo is precious. Their thirst for energy is high. And they don’t like hurricanes, earthquakes, or wildfires, which threaten to instantly wipe out exabytes of precious data. To host a data center, a location must meet a long list of conditions—everything must be “just right.” The few that do are considered Goldilocks Zones. Chicagoland is one of the best.
Ranked among the top two markets for data centers globally, the Chicagoland region offers all the conditions data centers need to thrive. State tax incentives and relatively affordable land make it a cost-effective location, while access to abundant water and affordable, reliable energy—not to mention the “free cooling” you get during a Chicago winter—provide the power and natural resources that data centers need.
Meanwhile, Chicagoland’s larger plats of available land make it possible to develop hyperscalers, large-scale facilities designed to store and process data from billions of users. A deep, diverse workforce and a local pipeline of nationally renowned academic institutions offer all the talent that facilities need to function. And access to a skilled labor force means that facilities can be built efficiently and go to market faster—a critical feature for an industry where speed is everything. (Read more about what the region offers data centers here.)
Another key advantage is Chicagoland’s diverse economy. The region is a hub for many of the most data-intensive industries, including finance, administrative services, logistics, life sciences, and the government sector, as well as a massive consumer base, meaning there’s always a high demand for local data centers. As these industries grow, and as the region invests in quantum computing and other high-tech fields, that demand is only rising.
Of course, that’s just one side of the story. Because while Chicagoland is transforming the data center market, data centers are returning the favor.
From ChatGPT to GDP: How Data Centers Impact the DuPage Economy
One common criticism of data centers is that they don’t create many jobs and therefore don’t generate significant value for communities. There’s a kernel of truth here—a typical data center will have a smaller staff compared to similarly sized facilities from other industries—but it ignores the potentially transformative economic impact that data centers have on the communities around them.
Starting with the staff: While data centers tend to create relatively smaller quantities of jobs, the ones they do create are high-earning. According to a report provided by JobsEQâ, the average data center employee in the Chicagoland region earns over $142,000 annually, meaning they have greater spending power than most employees from other sectors and can inject more money into the local economy. Beyond their own earnings, every data center position is estimated to create more than four jobs in the region, for a total of over $474,000 in additional earnings. It’s the data center domino effect.
And that’s only accounting for regular staff. Building a facility like the Oppidan data center in Carol Stream—not to mention the six that NTT is developing in Wood Dale—requires numerous construction jobs. Much like white-collar staffing positions, construction jobs generate additional employment; every construction role creates an estimated 1.64 additional jobs, producing over $239,000 in additional earnings. Factor in the cost of construction materials, as well as the fees for permitting and utilities, and you can see how data centers generate more revenue for communities than meets the eye.
In Wood Dale, for example, CyrusOne estimates their financial investment in the project will be over $1 billion. When all six buildings are complete, the City is projected to generate at least $2 million in annual utility taxes alone, money that can be reinvested in the community. Countywide, data centers have a significant impact on gross domestic product; in 2022, sectors directly related to data centers (such as computing infrastructure providers, data processers, and web hosting businesses) produced nearly $1 billion in GDP, with an average worker output of $986,000.
As impressive as those figures are, they don’t cover the full impact that data centers are making across DuPage. For Carol Stream, the new Oppidan facility is about more than generating revenue; it’s about taking a stagnant, abandoned property and transforming it into an attractive showpiece, one that’s both grounded in the community’s past and looking forward to the future. For Itasca, NTT DATA’s new cloud storage facilities aren’t “just another” development; they represent a reimagining of a suburban office park, one potential solution to a widespread challenge.
As communities across DuPage grapple with new ways of working, shifting industry trends, and other complex challenges, they’re rethinking economic development norms and repurposing spaces in creative ways. And while data centers aren’t the solution to everything, one thing is certain: They’re a key part of the equation.
$350M Investment Builds on Illinois’ Booming Tech Industry
Today, Governor JB Pritzker joined the CyrusOne team, Choose DuPage, ComEd, and local elected officials to break ground on the new data center in Aurora. The new campus, which consists of two buildings totaling 446,000 square feet, will serve local communities and national networks through the creation of state-of-the-art digital infrastructure solutions.
“When I became governor, I pledged to make Illinois a home for the high-tech, high-growth industries of the future,” said Illinois Governor JB Pritzker.“This groundbreaking is the culmination of years of work with our partners at CyrusOne, and secures hundreds of construction jobs as well as over twenty data center positions for the people of our state. CyrusOne’s new data center joins the ecosystem of high-tech sectors that are flourishing in Illinois– from electric vehicles to quantum computing to chip manufacturers – that form the foundation of sustainable economic growth.”
CyrusOne selected Aurora for this $350 million investment with future growth and expansion capabilities in mind. The data center will create hundreds of construction jobs and more than 20 full-time positions. It is set to open in early 2026, a very quick timeline for a data center of this size, due in part to Illinois’ many economic development assets that create opportunities for companies like CyrusOne.
“With the Chicagoland being the third-largest data center market nationally and demand continuing surging, this expansion aligns perfectly with our strategic plan to enhance our capacity and capabilities,” said Eric Schwartz, Chief Executive Officer of CyrusOne.“This investment reinforces our commitment to innovation and meeting the evolving needs of our customer base in this critical market.”
“ComEd is committed to powering economic development projects that create local jobs and drive investment in our communities,” said ComEd President and CEO Gil Quiniones. “CyrusOne’s new site in Aurora will deliver on those goals, while prioritizing sustainable building and ensuring opportunities for revenue and job growth for Illinois. We look forward to delivering the resilient and reliable electrical infrastructure needed to serve their needs today and well into the future.”
In partnership with the State of Illinois, CyrusOne has been approved for the Department of Commerce and Economic Opportunity’s data center investment program, which includes a Project Labor Agreement for the facility’s construction. IBEW will be the primary labor partner. CyrusOne has now invested over $1 billion across Illinois.
“This state-of-the-art data center expansion will strengthen our technological capabilities and create good-paying jobs for IBEW members. We’re excited to be part of this project that will help power Illinois’ innovation economy,” said IBEW Sixth District International Vice President Michael Clemmons. “I want to extend our appreciation to Governor JB Pritzker, whose tireless efforts in attracting these kinds of transformative investments have been instrumental in making Illinois a prime destination for projects that benefit our skilled workforce and our communities.”
“CyrusOne’s decision to include a Project Labor Agreement prioritizes the needs of Illinois working families by ensuring that the hundreds of construction jobs created will provide safe working conditions, good wages and benefits, and sustained investment in the local economy and workforce,” said Illinois AFL-CIO President Tim Drea.
The new campus builds on Illinois’ thriving data center industry, supported by the Pritzker administration’s data center incentives. Currently, four of the largest data center campuses in the nation are being built in Illinois, creating thousands of jobs and investing billions in the state.
When selecting sites for new data centers – facilities that house the computer servers responsible for powering today’s digital networks – companies must search for a ‘Goldilocks zone’ of conditions.
From affordable, reliable energy to a workforce that can keep the equipment running, everything has to be just right.
Now, a recent report ranks the Chicagoland region (including DuPage County) as the world’s second-best market for data centers, just behind Northern Virginia and ahead of the likes of Silicon Valley and Dallas-Fort Worth. Over the past several years, the region has leveraged its existing strategic advantages with new state sales tax incentives to create optimal conditions for data centers, and the world is taking notice.
It’s a data world—we’re just living in it.
Unless you’re in the industry, chances are good that you’ve never actually been inside a data center—most of us haven’t. At the same time, the servers housed in these facilities impact nearly every aspect of our lives.
From the Netflix series we binge on Friday nights to the files we download from our employers’ servers on Monday morning, much of the data we rely on every day is processed and stored within data centers, along with more sensitive information such as proprietary corporate data, financial assets, government files, and medical information. Virtually every modern business and government office relies on vast quantities of data. Data centers house this information, allowing clients to access it quickly and securely.
And data usage is only growing. As we integrate new technologies within our society – more advanced AI, Internet of Things (IoT) devices and 5G service, not to mention Facebook’s recently announced ‘multiverse’ project – we are building a world that is increasingly reliant on data.
Which is to say, a world that is increasingly reliant on data centers.
Today, companies cannot build data centers fast enough. Often, these businesses have clients lined up to use their services before they even break ground. At the same time, data centers are complex investments that require high volumes of capital; the majority of projects cost more than $250 million. With that much money at stake, as well as their client’s trust and security, companies are understandably picky when it comes to where they invest in new data centers.
What makes DuPage a top choice?
As the demand for real-time data transmission reaches an all-time high, the DuPage region has emerged as a prime location for data centers. A recent report from Cushman & Wakefield names the Chicagoland region (including DuPage) as the second-best market for data centers globally. That ranking comes as, over the past five years, DuPage has seen a 3.4% growth in data centers, with more projects in the works.
What makes the DuPage region a leading choice for data centers boils down to a mix of strategic advantages, including:
State and local tax incentives. Due to 2019 legislation, qualifying Illinois data centers are exempt from paying state and local taxes on equipment over a 10-year period, making the state a major draw for the sector. The same legislation provides a tax credit of 20% of wages paid to construction workers for projects located in underserved areas, spurring economic growth within these communities.
Experts say that these tax incentives – which make Chicago one of the most affordable national markets for data centers – will cause an uptick in leasing activity, as major cloud companies invest in the area. Illinois is also one of a few states that does not assess a personal property tax, another financial advantage.
While this incentive draws companies to the Chicagoland region, DuPage has the additional advantage of low property and sales taxes.
Access to affordable, reliable and renewable energy. “Every business relies on energy, but for data centers it’s mission critical,” said Ed Sitar, Manager of Economic and Business Development at ComEd, which provides electric power to the Chicagoland region.
To host and protect their clients’ assets, data centers depend on having access to energy at all times. And since these businesses require large volumes of energy, they need that power to be not only reliable, but affordable and clean.
ComEd, which is ranked among the top 10% of energy companies in the nation for performance reliability, provides highly reliable energy for customers at a rate that is among the most competitive in the U.S.
In addition, Illinois has the sixth-lowest electricity-generated carbon emissions in the country. Businesses here can obtain 100% renewable energy options through the competitive supply market, helping them reach their sustainability goals.
Illinois, already the sixth-largest wind energy-producing state, recently passed legislation that sets the state on a path for 100% renewable energy by 2050.
“Free cooling.” One of the greatest challenges of operating a data center is keeping servers cool. These devices are running all day, every day, and they tend to overheat. Due to the DuPage region’s northern climate, companies can pump outside cold air into their facility for much of the year, enabling them to cut back on energy usage. This gives the region an advantage over other popular markets in warmer climates.
An extensive fiber network. Data centers rely on a robust infrastructure of fiber optics, as well as other utilities. While facilities in other locations, particularly rural areas, often have to build this infrastructure from the ground up, DuPage already has it—enabling tech companies to reduce the time and cost of construction and get their facility running sooner.
Access to a massive talent pool. DuPage has a large and diverse talent pool living and working within the community. Many local companies also draw talent from Chicago, which is right next door. An extensive public transportation system makes commuting to and from the city easy.
Access to a highly skilled and diverse construction workforce. Building a data center is complicated and labor-intensive, requiring a large local workforce with specialized skills. And, as demand for data services grows exponentially, projects tend to run on a tight timeline.
As regions across the nation experience labor shortages – particularly in construction – many lack the skilled workforce needed to complete these projects quickly and efficiently.
DuPage is a different story. The region is home to the International Brotherhood of Electrical Workers (IBEW) Local 701 and the DuPage JATC, a joint apprenticeship training program between the National Electrical Contractors Association (NECA) and the IBEW. Through this collaboration, professionals are equipped with the latest construction techniques in state-of-the-art training environments. In turn, contractors can draw on this highly skilled labor to build the next generation of data centers.
“DuPage is fortunate to have a strong union labor-management collaboration including world-class training centers, where contractors have access to building trades persons who learn the latest construction techniques,” said Dan Allen, Executive Director of the Construction Industry Service Corporation (CISCO). “As a result, the data centers are built to precise specifications to house these mission-critical components. The availability of skilled union contractors, the skilled union workforce that they employ, and next generation of electrical workers currently being trained, puts DuPage County in a most favorable position to continue to attract these types of projects for years to come.”
A minimal risk of natural disasters. In many regions, floods, hurricanes, wildfires, earthquakes, and other natural disasters pose a serious threat to data centers – which often contain sensitive, irreplaceable data – a threat that is expected to intensify in the coming decades. A centrally located community in Northeastern Illinois, DuPage offers a safe location with a minimal risk of natural disasters.
Desirable amenities. DuPage features a beautiful network of nature parks, a thriving cultural and arts scene, and world-class dining and entertainment, as well as attractive living spaces and nationally ranked schools. These amenities help local companies attract and retain high-caliber talent.
A global transportation network. Three nearby international airports – O’Hare, Midway and the DuPage Airport – plus several major highways, make it easy for staff and clients to travel to and from practically anywhere in the world. In addition, DuPage is offering businesses unprecedented access to O’Hare through the Western Access Initiative.
How do data centers benefit our communities?
DuPage offers a number of benefits for the owners and operators of data centers, but how do data centers benefit DuPage?
While data centers are often criticized for failing to bring large numbers of permanent jobs to communities, that hasn’t been the case in DuPage—and it likely isn’t the whole story in other communities that are home to these facilities.
The majority of data centers in DuPage employ 25 to 100 full-time workers; in order to receive Illinois’ state and local tax breaks on equipment, centers must employ at least 20 full-time workers and the jobs must pay at least 120% of the given county’s median wage. And studies show that these high-paying jobs often generate many more jobs within the community.
According to a 2018 study by research firm RTI International, data center jobs have a ‘multiplier effect’ on the local workforce: “For every one data center worker, there were five jobs supported elsewhere in the economy by operating expenditures—after the surge in jobs caused by capital expenditures.” (This study was funded by Facebook and focused on its U.S. data center fleet. Its findings were consistent with a different 2018 study funded by Google and focused on European markets.)
In other words, data centers generate long-term job growth within communities, well beyond the construction contracts and other short-term jobs related to the initial investment. According to the RTI report, every $1 million spent on data center operations supports 13 jobs elsewhere in the economy.
Beyond creating jobs, data centers inject millions of dollars into the local economy through taxes—property taxes, but especially water and utility. In a February 2021 Sun-Times article, Lauren Huffman, spokesperson for the Illinois Department of Commerce and Economic Opportunity, said the state’s incentive programs have already generated more than 370 jobs and $4.5 billion in private investment. (Read more about the impact of data centers on local economies here.)
“DuPage is good for data centers, and data centers are great for DuPage,” said Ron Lunt, Founding Partner of development company Hamilton Partners.
In early 2021, NTT Ltd., one of the world’s largest information-technology companies, opened their U.S. Data Center Campus at Hamilton Partner’s Hamilton Lakes Business Park. Located in Itasca at the intersection of the new Elgin O’Hare Expressway (I-390) and I-355, the park is a 15-minute drive from Chicago’s International Airport. In addition to office space, the campus features the Westin Hotel, the Hamilton Lakes Athletic Club, a daycare center, nature paths, and various restaurants.
“They employ our people, they fund public projects, they invigorate our local economy, and, importantly, they help us continue to attract further investment. DuPage is emerging as a global hub for innovative companies and talented people, and data centers play a key role.
“These are forward-thinking companies—they’re always looking to the near- and long-term future. And when they look at DuPage, they see an environment that has everything they need to build this future.”
ABOUT DUPAGE COUNTY, ILLINOIS
Just west of Chicago, DuPage County is a diverse, innovative community offering a strategic location, a collaborative environment, a diverse culture, beautiful parks and trails, a vibrant arts scene, excellent schools, responsible local governance, and world-class workplaces.
