As server farms and data centers begin to sprout in local municipalities, officials are realizing that the zoning codes were written for factories and warehouses, not billion-dollar computing fortresses. The result: a patchwork of delays, rewrites, moratoriums and heated community push-back that could reshape local real estate and infrastructure.
The zoning gap
Since internet infrastructure blurs traditional zoning definitions, local governments must determine where it fits. Though built to sustain the digital world, data centers still operate in the physical one – and are subject to the same real estate rules and zoning codes as any other large-scale development.
Many local governments classify data centers as specific land uses, but zoning classifications can vary depending on the city or county’s ordinances. While it’s not uncommon for zoning laws to prohibit specific types of buildings or uses for the land within its boundaries, almost no zoning laws have specifically mentioned data centers. When zoning laws aren’t specific, they create grey areas that can ultimately lead to lengthy, complicated disputes over whether or not the data center complies with local ordinances.
Counties in northern Georgia are a prime example of cities catching up to data center development plans – since March 2025, three counties in Georgia have passed moratoriums on data center development as county commissioners’ growing concerns over water and energy usage and a general lack of consensus of how to fit data centers into current ordinances demand an overhaul.
“People just don’t understand [data centers], yet,” said Pike County Commissioner James Jenkins to Kala Hunter of the Ledger Enquirer. “And I motioned a moratorium because it would create a better understanding of how to accommodate [data centers].”
Local ordinances and regulations will have to evolve to accommodate the growing demand for these centers around the country, especially as artificial intelligence continues to rise in reliance.
Where zoning has gone right, with limitations
‘Data Center Alley’ has steadily crept up into the backyards of McMansions, turning Northern Virginia suburbs into the highest concentration of internet infrastructure in the world. The region was initially developed in the early 1990s due to its proximity to Washington, D.C., its supportive regulatory policies, and local governments’ tax incentives for tech giants like Amazon and Microsoft. Although the presence of these tech companies and digital infrastructure boosts the local economy, the growth has also placed undue strain on the region with escalating water and energy demands. Data centers already consume more than 25% of Virginia’s energy, according to a 2024 study performed by the Electric Power Research Institute.
Though developers often claim data center construction will improve local economies by creating jobs, this is a misleading promise to local stakeholders. Though their construction can create short-term jobs, data centers themselves run with few full-time employees. For instance, a data center may employ 1,000 temporary workers while the center is under construction but rarely need more than 100-200 to operate. Data centers do create jobs, just not always at the expected scale.
To adapt or to react?
Residents of Northern Virginia have adapted to proximity to these data centers – runners and cyclists along the Washington & Old Dominion trail enjoy the concrete jungle landscape of the world’s internet traffic. Thousands of commuters pass by them daily on their way into the city. Residents are no stranger to highway development, but now that they are becoming topics of conversation in local homeowner’s associations, data centers are falling from lukewarm grace.
Plaza 500 is one of the latest proposals for new data center development in the area and has been widely protested by local residents. The Fairfax County Board of Supervisors decided in September 2024 that all new data center developments would have to adhere to stricter zoning laws – however, the Plaza 500 project was grandfathered in under the old rules.
For real estate professionals, developers and municipalities, the controversy is a reminder that digital infrastructure doesn’t exist in a vacuum. Keeping pace with its expansion may require a continually critical look at zoning maps and the ‘rules of place’ of 21st century real estate.
