The company that operates Facebook, Instagram and WhatsApp has completed the $8.5 million purchase of more than 1,000 acres of city-owned Northeast El Paso land for a proposed huge data center.
Meta Platforms Inc., under a company it established to buy the land, completed the sale on Dec. 29. That’s 3½ months earlier than the sale contract’s April 18 deadline for moving forward with the sale without a contract extension.
The land sale agreement was approved by the El Paso City Council on Dec. 4, but city officials did not announce its completion.
The City Council and El Paso Commissioners Court on Dec. 4 also approved providing millions of dollars in tax rebates to Meta over 25 years to encourage it to spend a minimum of $800 million to build a hyperscale data center.
Meta officials have yet to publicly announce the company will build a data center at the vacant El Paso site. However, the land sale is a big step toward proceeding with the project. It has up to five years to develop the property, according to the sale contract.
The vacant land is located along a little-used portion of Stan Roberts Sr. Avenue and just off of U.S. Highway 54 — not far from the New Mexico state line.
Data centers house computers and servers to process data for customers. Hyperscale data centers are large and can quickly scale up or down to meet demand. However, the centers don’t have large workforces.
The land sale was contingent on Meta obtaining a water-supply agreement with El Paso Water, which it did in early December. It waived a contract requirement that it also have a power-purchase agreement with El Paso Electric prior to the sale closing.
Meta and EPE are still negotiating a power agreement, Kelly Tomblin, the utility’s chief executive officer, recently told the El Paso Times.
The Meta-tied company, Wurldwide LLC, entered an agreement with the city and paid a deposit of $333,600 on April 18, 2022, to inspect the land for up to a year, with possible extensions. Meta instead completed the land sale on Dec. 29, a city spokesperson said.
CBRE, a global commercial real estate firm, did an appraisal in April 2023 of the 1,042-acre site for the city and concluded the site’s market value was $8,156 per acre. It based that value on evaluating sales of five El Paso-area vacant land sites, which sold for prices ranging from $6,550 to $16,929 per acre, the CBRE appraisal report shows.
The city sold 1,039 acres of the site for $8,156 per acre, or just under $8.5 million, and retained three acres. City staff handled the land deal without using an outside broker, said Karina Brasgalla, interim director of the city Economic and International Development Department.
The money from the sale goes into the city’s capital assets fund for future capital-asset purchases as required by city charter, Brasgalla said.
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Meta has to build at least an $800 million data center and invest at least $2.8 billion over 25 years, including costs of periodically updating the center’s equipment, to get $110 million in mostly tax rebates and other incentives, a city official reported in December.
However, if it builds a five-phase campus, as city officials are hoping, and spends at least $14 billion, including equipment refreshes every five years, it could get more than $500 million in tax rebates over 25 years, city information shows.
Vic Kolenc may be reached at 915-546-6421; vkolenc@elpasotimes.com; @vickolenc on Twitter, now known as X.