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Data Centres: Boom and Backlash
26MAY

Prime breaks ground on 240 MW Phoenix

2 min read
11:34UTC

Prime Data Centers broke ground on three of five buildings at a 240 MW Phoenix campus on 22 May, with three buildings pre-leased to an undisclosed hyperscaler, showing continued build momentum in Sun Belt markets.

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IndustryDeveloping
Key takeaway

Build momentum continues in Sun Belt jurisdictions with cleared planning consent and grid access.

Prime Data Centers broke ground on three of five buildings at a 240 MW campus in Phoenix, Arizona on 22 May, with the three buildings already pre-leased to an undisclosed hyperscaler. 1

The Phoenix start is a Sun Belt data point within the $110.75bn quarterly hyperscaler capex cycle . Pre-leased construction in a cleared-consent jurisdiction shows capital continuing to commit while Virginia's fiscal fight and the moratorium-exposed markets stall elsewhere. The contrast holds the topic's boom-and-backlash tension in a single fortnight: shovels in Arizona, cancellations in Southside Virginia.

Deep Analysis

In plain English

When a data-centre developer breaks ground on buildings that are already leased before a single wall is built, it means a major customer has signed a contract to occupy the space before construction finishes. This is called a pre-leased build, and it is how most large data centres now get financed. Phoenix benefits from Arizona's relatively permissive planning rules, access to large amounts of solar power at competitive prices, and grid-connection timelines of 18-24 months, far shorter than the multi-year queues operators face in Virginia or the PJM region. The 240 MW campus, when complete, will consume as much electricity as a city of roughly 200,000 homes.

What could happen next?
  • Opportunity

    Phoenix, Columbus, and other Sun Belt markets with cleared consent and sub-24-month grid connections are structurally positioned to absorb pipeline redirected from Virginia and moratorium-threatened cities.

Sources:Data Center Dynamics
Mentions:Sabey Data Centers →Virginia →Northern Virginia →Arizona →Loudoun County DC cluster →Prime Data Centers →Phoenix →
First Reported In

Update #4 · Grid wins power to switch off data centres

Data Center Dynamics· 26 May 2026
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Different Perspectives
Global hyperscale operators
Global hyperscale operators
Operators are still filing gigawatt-scale campuses and Meta is proceeding with its $10bn Lebanon, Indiana site despite the county-level bans nearby, betting Q2 capex outruns the patchwork of restrictions. Industry framing casts New York's freeze, Oregon's surcharge and Indiana's bans as taxes and levies that push build-out toward faster-permitting jurisdictions such as India and the Gulf.
EirGrid
EirGrid
EirGrid set a 900 MW instantaneous demand-loss ceiling because a single voltage dip can trip many data centres onto backup power at once, risking imbalance above 1,150 MW. It wrote the limit into a standing procedure rather than waiting for an emergency to force one.
US host communities and ratepayers
US host communities and ratepayers
Prince William residents backed the 8-0 denial of Dulles South over the Occoquan watershed, drinking water for eight million people, while Oregon's approved tariff cuts residential bills 1.3% by charging large loads 29% more. Their position: consent and cost-attribution belong in law, not left to a developer's or a utility's discretion.
Hassan Allam Digital Infrastructure
Hassan Allam Digital Infrastructure
Hassan Allam Digital Infrastructure, an Egyptian conglomerate rather than a foreign hyperscaler, reportedly secured a domestic hyperscale licence with a $400m first phase, per single-source reporting still to be verified. It reads as home-grown sovereign compute ambition, building national capacity rather than importing a US or Gulf operator's campus.
Damac Digital
Damac Digital
Damac Digital keeps building toward roughly 6,000 megawatts of hyperscale capacity across 13 countries while Virginia taxes power and New York weighs a freeze. Every dollar or month of delay a US state adds is capacity a Gulf developer can site somewhere with faster permitting and no equivalent levy.
Acequia communities, Santa Fe County
Acequia communities, Santa Fe County
Santa Fe County commissioners voted unanimously on 2 July to freeze any data centre over one megawatt, citing the acequia irrigation commons that has shared scarce water since Spanish colonial rule. They expect the low threshold to draw the same Fifth Amendment challenge RCM Hill brought against Hill County, Texas.