Amid Shifting Regional Data Center Policies, Iron Mountain and DC Blox Both Expand in Virginia's Henrico County

The dynamic landscape of data center developments in Maryland and Virginia exemplify the intricate balance between fostering technological growth and addressing community and environmental concerns.

Data center developers in this region find themselves both in the crosshairs of groups worried about the environment and other groups looking to drive economic growth. In some cases, the groups are different components of the same organizations, such as local governments. For data center development, meeting the needs of these competing interests often means walking a none-too-stable tightrope.

Rapid Government Action Encourages Growth

In May 2024, Maryland demonstrated its commitment to attracting data center investments by enacting the Critical Infrastructure Streamlining Act.

This legislation provides a clear framework for the use of emergency backup power generation, addressing previous regulatory challenges that a few months earlier had hindered projects like Aligned Data Centers' proposed 264-megawatt campus in Frederick County, causing Aligned to pull out of the project. However, just days after the Act was signed by the governor, Aligned reiterated its plans to move forward with development in Maryland.

With the Quantum Loop and the related data center development making Frederick County a focal point for a balanced approach, the industry is paying careful attention to the pace of development and the relations between developers, communities and the government.

In September of 2024, Frederick County Executive Jessica Fitzwater revealed draft legislation that would potentially restrict where in the county data centers could be built. The legislation was based on information found in the Frederick County Data Centers Workgroup’s final report. Those bills would update existing regulations and create a floating zone for Critical Digital Infrastructure and place specific requirements on siting data centers.

Statewide, a cautious approach to environmental and community impacts statewide has been deemed important. In January 2025, legislators introduced SB116, a bill mandating a comprehensive study on the economic, environmental, and energy consequences of data center development. This initiative aims to evaluate how these facilities affect natural resources, power demands, and local finances, ensuring that growth aligns with sustainability goals.

The synopsis of the bill makes the goals quite clear, but it doesn’t require the final report to be delivered until September 2026:

“Requiring the Department of the Environment, the Maryland Energy Administration, and the University of Maryland School of Business, in coordination with the Department of Legislative Services, to conduct an analysis of the likely environmental, energy, and economic impacts of data center development in the State; and requiring the Department of Legislative Services to coordinate preparation of the final report to be submitted to the Governor and the General Assembly by September 1, 2026.”

This newly proposed legislation, which would apply statewide, has the potential to restrict data center locations, require extensive environmental assessments, and set stringent standards for emissions and fuel storage, all of which are yet undefined.

Whether these standards would supplant local efforts or be applied on top of any local regulation is yet unidentified. But for the long-term, these measures reflect a desire to balance economic benefits with the preservation of community character and environmental health. And statewide legislation does have the benefit of preventing a patchwork of local legislation which could set varying standards and regulations.

As Goes Virginia, So Goes the Industry

Meanwhile, neighboring Virginia, especially northern Virginia, is home to a significant concentration of data centers and continues to attract substantial investments, with 117 data centers already in an advanced approval stage. Loudoun County, the heart of Data Center Alley, has consistently been looking at different ways to get control of data center development without stopping the investment in the county by data center developers and the ongoing tax revenues that the county and its residents benefit from.

Even with all of this data center growth and almost weekly announcements of new data center development, Virginia faces mounting challenges related to the rapid expansion of data centers. The state legislature is currently deliberating the extension of tax incentives for these facilities, with debates focusing on the need for increased transparency, environmental safeguards, and a reevaluation of the economic benefits provided by such incentives. As of yet, most of the significant attempts to control data center proliferation are at the county level.

Fairfax County, for instance, has implemented stricter zoning regulations, including increased setbacks from residential areas and requirements for noise and environmental impact studies. These policies aim to mitigate the adverse effects of data centers on local communities while accommodating technological advancement and potential tax revenue benefits.

Iron Mountain in Henrico County

In February 2025, Iron Mountain announced plans to build a new data center campus in Virginia's Henrico County, highlighting the region's ongoing appeal to major industry players.

The company has acquired a 66-acre site at 6110 Technology Creek Drive within the White Oak Technology Park, a business park spanning over 2,200 acres dedicated to technology and data center developments. The planned campus will encompass four data center buildings, totaling more than 1 million square feet, with an expected capacity exceeding 200 megawatts. This development represents an investment exceeding $1 billion and is anticipated to generate substantial tax revenue for Henrico County.

Henrico County's White Oak Technology Park is already home to data centers operated by companies such as QTS Data Centers and Meta, the parent company of Facebook and Instagram. Iron Mountain's decision to establish its campus in this location underscores the area's robust infrastructure and strategic importance in the data center sector.

Its significant expansion in Virginia aligns with Iron Mountain's commitment to investing in high-growth markets and delivering exceptional solutions for its customers. The company's global data center footprint now includes over 25 facilities across three continents, all powered by 100% renewable energy.

In wake of the project's announcement, Virginia Governor Glenn Youngkin certainly sounds like a data center supporter, saying:

Virginia is the data center capital of the world, and projects like this one in Henrico County are supporting opportunities for continued economic growth. Iron Mountain’s major project not only creates valuable jobs but also strengthens Virginia’s position within the data center industry.

As a clear example of the somewhat confused nature of the relationship between counties in Virginia and the data center industry, the Greater Richmond Partnership (GRP), the Henrico County Economic Development Authority and the Virginia Economic Development Partnership were all involved in Iron Mountain's decision to build in their county.

Jennifer Wakefield, GRP’s President and CEO, was quoted as saying:

Iron Mountain was approached by the Greater Richmond Partnership nearly two years ago and joins Meta, QTS, Chirisa and Pixel Factory as operations which tap into four high-speed subsea fiber cables that span four continents.

Identifying the extended decision-making process which brought Iron Mountain to the county, Jody K. Rogish of the Henrico County Board of Supervisors and Greater Richmond Partnership’s Board of Directors said:

Henrico welcomes Iron Mountain to its family of data center operations. Henrico County’s data center infrastructure, including the Richmond Network Access Point, proves its immense value with affordability, energy availability and access to the world’s fastest internet connections.

DC Blox Debuts In Virginia

Yet in the same week that Iron Mountain made their announcement, DC Blox announced that they would also be developing a 65,000 sq ft data center in Virginia's Henrico County, which, as reported by the website Richmond BizSense and real estate transactions chronicler Gorva, is being done despite opposition to their plans by the local community and the Henrico Planning Commission.

The project is the first in Virginia for DC Blox, which has built similar facilities in Atlanta, Alabama and South Carolina. The developer responded to complaints from the local community by moving the data center site to a different 5 acre section of the 30 acre plot that was purchased for $8 million in January. While DC Blox had moved earlier to have the property rezoned, the existing zoning already permitted the development of a data center.

As is somewhat common, the data center site is bordered primarily by industrial park locations, including a large Amazon distribution center across the highway, though there is a residential site in close proximity. DC Blox withdrew their request for rezoning after negotiations with the community.

Quoting Chris Gatch, Executive Vice President and Chief Revenue Officer for DC Blox, BizSense reported:

We're going to put $60 million into this facility out of the gate, on a piece of property behind that storage facility that would have otherwise never carried that much tax base. If this facility reaches its full expansion potential (for) this single-tenant customer that is occupying it, it’ll be almost a $100 million investment. We hope that’s just a start for us in Richmond. We’re looking at other locations as well.

Walking the Tightrope

The experiences of data center operators expanding in Maryland and Virginia underscore the complexities inherent in data center development. Both states strive to harness the economic advantages of hosting these facilities—such as job creation and increased tax revenue—while addressing legitimate concerns about environmental impact, resource consumption, and community well-being.

As the demand for data centers escalates, driven by cloud computing and artificial intelligence, the policies and approaches adopted by these states may serve as critical models. The challenge lies in crafting strategies that promote technological infrastructure without compromising the quality of life for residents or the health of the environment.

The industry needs to remain proactive in this, offering development plans with these considerations in place, and maintaining the awareness that by doing so, the developers will limit the demand for local governments to place these restrictions on future data center projects without consultation with the industry.

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