Vacant houses in Waterloo City, Iowa will be demolished to make way for two data centers, with the project guaranteed to have a minimum assessed value of at least $200,000.
The demolished sites will be redeveloped by South Front Networks, a regional carrier-neutral fiber optic company that owns four data centers across Minnesota and Iowa.
Waste not, want not
According to the Waterloo-Cedar Falls Courier, who first reported this story, the houses are being torn down because they are “beyond repair and have lots littered with junk.”
The city seized the three vacant houses and bought a fourth on the same block for $20,000 to clear out the site for redevelopment.
Noel Anderson, director for community planning and development in the city, said: “This is a great use of our blight elimination policies we’ve been working on. It will raise the taxable value of the site by about 10 times what it was before.”
But as the sites are designated Consolidated Urban Revitalization Areas (CURA) - vacant building in a state of disrepair- the data centers built on the site will be applicable for a tax abatement.
The tax abatement for an area of this kind applies to any improvements to the property, so depending on the site, South Front Networks might be exempt from paying property tax on any improvements for three years. Alternatively, improvements on the site could be applicable for tax abatements for ten years starting at an 80 percent exemption which is then decreased in 10 percent increments every year.
As a CURA, the city will also sell the sites to South Front Networks for just $1. The city will also pay back the data center company for any broker fees (expected to be $6,000), the first half of which will be paid back when ground is broken on the first facility and the second half will be paid back when the facility is occupied.