For the longest time, industrial real estate and data centers have been viewed as separate asset classes. But with the rise of e-commerce, cloud services, automated manufacturing and robotics, savvy industrial developers and investors are warming to the idea of industrial real estate having a data center component.
CBRE Data Center Solutions/Brennan Investment
An aerial rendering of Elk Grove Technology Park
Two weeks ago, Brennan Investment Group announced plans for Elk Grove Technology Park, a $1B development on 85 acres in Elk Grove Village, Illinois. Filling the largest infill site in Chicago’s O’Hare submarket, Elk Grove Technology Park would help solidify Chicago’s status as both a top industrial market and a premier data center market.
Brennan Investment Chairman Michael Brennan said the park is a bet on the future of industrial real estate in three ways. He believes the manufacturing renaissance brought about by the advent of robotics and automation will eventually reshore in the U.S. Second, technology is bringing new forms of distribution to the U.S. with the proliferation of online retailing.
Lastly, Elk Grove Technology Park will also accommodate a wide array of data center uses, amidst a seemingly insatiable demand for data and cloud storage. Brennan said the park’s location, plus the convergence of these three demand factors, make this a perfect project for Brennan Investment.
“When it’s completed, Elk Grove Technology Park may be the greatest industrial park in the U.S.,” Brennan said.
Dees Stribling/Bisnow
Venture One Real Estate founding principal Mark Goode and Brennan Investment Group Chairman Michael Brennan
Brennan’s commitment to building a technology park, particularly with data centers, is surprising. Brennan said he is a purely industrial player, and that will not change. But data centers are increasingly taking footprint that previously would have gone to pure industrial. With improved fiber optic and utility infrastructure, data centers have grown into a good fit for industrial-heavy parks like Elk Grove.
