The Ankeny City Council voted Monday to approve a development agreement for the construction of a 105,000-square-foot multi-tenant data center on the city’s southeast side.

The data center will be built by Edged Des Moines LLC, who acquired the 17½-acre parcel at Southeast 90th Street and Southeast Four Mile Road, just north of Interstate 80, for $3.7 million in late 2024. The development agreement includes an incentive of a five-year sliding scale tax increment finance package not to exceed $2 million, and the creation of 22 jobs that pay between $29.76 and $35.71 an hour.

Construction is expected to begin in late spring or summer of this year and be ready for customers by the end of 2026.

Mitch Fonseca, chief operating officer for Edged, said Ankeny and Iowa are attractive places to build a data center because they are strategically located in the country and are known for having affordable, renewable power, a skilled workforce and a high level of fiber connectivity.

“So it ends up being a very good location, and the broader Des Moines area [is] becoming a fast-growing data center market over the last five years, so it’s really started to grow significantly,” he told the Business Record before Monday’s meeting. “Iowa has seen a ton of development which is being driven by cheap power, which is a huge factor, skilled labor is a huge factor, and fiber connectivity is also helpful.”

The planned data center in Ankeny is the first in Iowa for Edged. Fonseca didn’t rule out future growth in the state but declined to say where the company might build future data centers.

“It’ll be the first in Iowa and it will have a couple of siblings fairly shortly,” he said. “We’re starting to expand fairly quickly into the Iowa market.”

The data center will initially have a 13.2-megawatt capacity, but Fonseca said once the company establishes itself in a market it will immediately begin looking at opportunities for expansion.

Edged uses a closed loop system, which uses a water and glycol mixture to cool its data centers, which means no water is wasted and in effect requires little to no water to cool the data center.

Edged builds multi-tenant data centers for third-party users, with centers often having more than one customer. Some of those users can be larger, hyper-scale users, such as Microsoft, Meta or Google.

“In most of those multi-tenant facilities you will get the hyper-scalers. They are a customer of ours as well, but it most cases it will be their network nodes that deploy within those types of facilities as well as large enterprises, so those are part of the big demographics that are buying facilities at this scale,” Fonseca said. “Des Moines is growing as a data center market, and the more connectivity that gets attracted to the market the more you’ll see these multi-tenant data centers pop up because the enterprises like to deploy close to the cloud environment and cloud networks because that’s who they’re communicating with on a consistent basis.”

While Edged builds multi-tenant data centers, it also builds larger facilities for single-tenant users, Fonseca said, saying that is the model the company is working on for another site in Iowa.

Edged had previously submitted its site plan for the project and the City Council has already rezoned the site to accommodate the data center, and the development agreement was the final step before site work can begin, said Derek Lord, Ankeny’s director of economic development.

Fonseca said Edged gets involved with the communities where it has a presence with local food, clothing and toy drives, scholarship programs for underrepresented communities, and a program to increase the number of women in technology careers. Edged has also participated in a Habitat for Humanity home build in one location and plans to do a bike drive in another.

“We do like to get out and help the community in any way we can,” Fonseca said.

The data center represents a $187 million investment, with Edged paying for the extension of water and sewer to the site. That will extend service to an additional 120 acres, opening the area for new development.

Once complete, the data center will increase the taxable valuation of the property by $41 million. After the incentive package expires, about $1.25 million in tax revenue will be generated by the project.

While the company is based in New York, 99% of Edged employees work remotely except for staff members that work at a data center site, Fonseca said.

Lord said the city has been working with Edged for more than three years on the project, “so we’re very excited for it to get to the finish line.”

He and Fonseca also credited MidAmerican Energy Co.’s participation in helping to bring the project to fruition.

“We’re extremely excited about it and we feel it is a market that can grow very quickly,” Fonseca said. “It’s very economical for us to expand within the same market. We think it’s going to be a growing market for a very long time, so we’re extremely excited.”

This story has been updated to show the Ankeny City Council’s approval of the development agreement with Edged Des Moines LLC for the construction of a data center on the city’s southeast side.