Quantum Loophole will no longer have any "active involvement" in the Quantum Frederick Project, a 2,100-acre data center campus and fiber optic loop (QLoop) in Frederick County, Maryland.

First announced by TPG Real Estate and Quantum Loophole in 2021 - before the current gigawatt boom - the 2GW project was soon hit by delays and controversy.

This September, TPG sought a court order to remove Quantum Loophole from its role as manager of the $5 billion project as relations between the two companies soured.

Quantum Loophole
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That case has now been resolved, with both TPG and Quantum Loophole agreeing to dismiss all litigation between them.

“The matter has been amicably resolved to the satisfaction of both parties, and the parties have and will have no further comment on this matter," Quantum Loophole CEO Josh Snowhorn told DCD, declining to clarify if the company received any payment for stepping back from the campus.

TPG-owned Catellus Development Corporation will be the sole developer of the project going forward, overseeing all aspects of its day-to-day management and execution.

TPG told DCD in a statement: "This resolution allows TPG and Catellus - which has been on the ground in Maryland for the past six months - to further engage stakeholders, hear and address their concerns, and move the project forward in a way that best serves the Frederick community.

"TPG and Catellus remain confident in the project and look forward to working together to deliver best-in-class, environmentally sound data center capabilities to Maryland. TPG and Catellus remain optimistic that the project will drive billions of dollars of economic growth and create tens of thousands of jobs for Frederick County."

The Quantum Frederick Project is envisioned as a campus of campuses, where other data center companies would develop on the site, and take advantage of the QLoop and other shared infrastructure. The 40-mile fiber ring QLoop, which tunnels under the Potomac, directly connects the campus to Northern Virginia.

The site is pitched as being a natural extension of Virginia, the world's largest data center hotspot that has since become overcrowded and grid-constrained.

But community and environmental concerns have delayed work on the campus. In April, construction ground to a halt when the Maryland Department of Environment raised concerns that drilling to lay fiber cables had released clay into Frederick’s water supply.

This followed a similar incident in 2023 when work was paused due to "numerous environmental violations."

Quantum Loophole previously lost its first tenant for the site, Aligned Data Centers. The company planned to take 264MW of capacity at the campus but decided against it because Maryland state rules would have limited the number of diesel backup generators it could install.

Maryland has since amended its regulations around backup generators, easing restrictions for data center firms, but Frederick's lawmakers have also introduced two new bills that, if adopted, would put stricter controls on where new projects can be located in the county.

In May, Quantum Loophole said it had sold a 150-acre plot on the site, but did not name the client or the terms of the deal. That month, Aligned told DCD that it would once again plan to build at the park due to the regulatory changes. It will be joined by data centers from Rowan Digital Infrastructure.

Quantum raised $13 million in seed funding in 2021 before TREP, the real estate equity investment platform of asset firm TPG, invested. It is believed to have taken a 20 percent stake in the company at the time, but it is not known how much it invested then and since.

“We had bidders hunting us down and competing to invest in us,” Snowhorn told DCD when we visited the site in 2023.

“TREP are wonderful partners with a deep understanding of the data center sector. They looked at the assets that were for sale; Switch and CyrusOne and lots of other folks out there, but I think that they looked at it as a world that was starting to commoditize itself a little bit. But they looked at us as a business, as a wholesaler to the wholesalers, that is unique and less at risk of being commoditized. We're going to be the single greatest return they've ever seen.”

Quantum Loophole does not currently have any other campuses publicly in development, but said that it would "continue to assess other projects across the United States."

If you worked on the Quantum Frederick Project and wish to share your experience, you can contact us anonymously here.