City of St. Louis Approves Permit for Data Center Project, Announces Significant Conditions and Community Benefit Framework

Today, the City of St. Louis Board of Public Service unanimously approved a conditional use permit for the construction of a data center at the old Famous-Barr warehouse property.

This approval comes with a significant number of required conditions to address concerns raised by the community, including noise, walkability, sustainability and the use of power and water. The City has also negotiated robust terms for a community benefits agreement to ensure the St. Louis community comes out ahead.

"While St. Louis is already home to 12 data centers, which we know are important to the modern economy and local industries like geospatial, finance and healthcare, we as a City are committed to a simple principle," said Mayor Cara Spencer. "We want St. Louis to be open for business, but business on our terms; that means we're only going to allow the development of data centers if the community benefits."

At Mayor Spencer's direction, over the last month, the City has significantly strengthened the required conditions and their enforceability, and established a foundation for ongoing monitoring. These conditions are designed to mitigate potential environmental and economic impacts to the community.

The entire list of conditions has been made publicly available with this press release, but includes these highlighted items requiring that the developer:

• Use a closed-loop system and air-cooled chillers to minimize water consumption.
• Pay any new large load or data center-specific water rates determined by a cost-of-service study, as well as fund a hydraulic model study and rectify any detrimental impact the development may cause on existing customers. Prior to the study completion, an agreement may establish a short-term rate for this use.
• Recycle all electronic waste with the highest environmental certification (R2), which requires independent, third-party audits of facility operations, worker safety and downstream vendor tracking.
• Achieve and maintain compliance with all wastewater discharge standards set by the Metropolitan St. Louis Sewer District, once the facility is operating.
• Ensure that at least 50% of the data center's energy load comes from renewable sources within five years of commencing operations. Additional target may be set in a community benefits agreement.
• Maintain a Power Usage Effectiveness (PUE) of 1.25 or better, or 1.35 or better if more than 50% of the existing building on the parcel is repurposed.
• Annually report waste heat rejected to the outdoor environment, the quantity of waste heat recovered or reused, and the peak heat rejection rate during summer design conditions or the hottest observed days.
• Never use on-site generators as a general operating power source.
• Place noise-emitting equipment, including backup generators, away from primary frontages and enclosed within acoustically treated structures.
• Only test backup generators between 10 a.m. to 12 p.m. and 2 p.m. to 5 p.m. Monday through Friday, and never test on bad air quality days.
• Incorporate battery storage for backup power to minimize reliance on diesel generators.
• Operate the building with a cool roof, green roof, and/or rooftop photovoltaic solar panels to reduce urban heat impacts.
• Provide and maintain landscaping and/or screening to screen equipment from any proposed or existing greenways along the premises.

Should any conditions not be met, the City is able to revoke the occupancy permit if issues are not corrected.

In addition to the above conditions, the City has also negotiated key terms for a community benefits agreement with the developer to secure quantifiable economic, environmental and infrastructure benefits, and protect our community against any risks and uncertainties associated with the project.

Term sheet details are also released with this press release and include the following provisions, binding the developer to:

• Contribute $30 per square foot of approved data center development, an estimated $15 million to a City fund for the use on:
  • Multi-modal enhancements (e.g., Brickline Greenway);
  • St. Louis Digital Access Inclusion Plan activities; and
  • Economic and environmental justice activities, including for local distributed energy and weatherization.
• Install and maintain sidewalks adjacent to Market Street and a pedestrian pathway to the Grand Metrolink station.
• Not seek local tax abatement incentives for the data center or Armory buildings.
• Confirm tax revenue estimates and pay $15,000 in liquidated damages for every $100,000 below the projected annual tax revenues if not met by 2029.
• Meet escalating, median-wage "Job" minimums for 20 years (starting at 25 in year 1, 50 in year 2, and 100 thereafter) and pay $2,000 in liquidated damages for each job short of the required total.
• Comply with the City's First-Source hiring ordinance to prioritize City residents for entry-level jobs. This also applies to large tenants.
• Ensure the 500 Prospect property conforms to mutually agreeable plans for pedestrian, stormwater management, and heat island mitigation enhancements if used for parking.
• Comply with all federal, state and local nondiscrimination laws, as well as specific City ordinances pertaining to minority-owned and women-owned business (M/WBE) participation, workforce development, and prevailing wage compliance. This also applies to contractors, and covenants will run with the land to prohibit discrimination in the sale, lease, or use of the property.
• Establishes a performance schedule, with the data center completely operational by the end of quarter four of 2028. Permits will not be issued until all Green Street properties are current on taxes.
• File a decommissioning plan to safely remove and recycle electronic waste if the data center is vacant for over a year.
• Not lease the data center to tenants primarily using the premises for crypto-mining or other undesirable business uses.
• Public disclosure of tenants unless prevented by national security interests.

The City will be able to seek legal recourse, including financial compensation, if specific provisions of the community benefits agreement are not met. To the City's knowledge, this is the only such agreement negotiated for a data center project not receiving tax incentives from a city or county.

Since the St. Louis Water Division is owned by the public and needs to invest significantly in improving its aging water infrastructure, St. Louis is in the unusual position where regular water users would benefit from large water users, such as data centers, being added to the system, because it would move some of the cost of the needed maintenance from existing users to the new large users.

The development is expected to create 200 full-time jobs once completed, including 150 in the Armory, which will be redeveloped as office space, and generate first-year tax revenue of $27.4 million for the City of St. Louis and $33.4 million for the St. Louis Public Schools.

For comparison, the fiscal year 2026 budget for the Refuse Division is $28.8 million. The Street Division budget is $12.6 million and the Forestry Division's is $11.8 million.

Over 10 years, the development is expected to generate $432.3 million in tax revenue, helping not only to fund city services and children's education, but also libraries, the Zoo Museum District, the Metropolitan Sewer District, senior services, and more.

"As mayor, I cannot responsibly ignore the amount of good this amount of tax revenue will do for city services, SLPS students and some of the most important amenities and services that our community depends on," said Mayor Spencer. "Though I share many concerns about data centers, we have negotiated hard to address the concerns we have any control over and ensure that our community reaps the benefits if this development moves forward."

Local labor and teachers unions shared their support for the City's approach to thoughtful conditions for this project, creating good-paying jobs and supporting local schools.

"This is an important new direction for working families, the schools and the City of St. Louis. This revised proposal represents what could be a national and local model for all developers. The public, city leaders and union officials had real concerns regarding any data center proposal. The Armory Project team went through the process, listened and addressed those concerns," said AFT St. Louis, Local 420 President Ray Cummings. "Unlike some other data center concepts, this revised proposal offers tangible benefits paying a fair share of taxes and public benefits it will generate for SLPS and the City. The impact on school funding, city tax revenue, union jobs and the developer's responsiveness are groundbreaking and can be emulated."

"Today, the residents of St. Louis took a big step forward. The members of the St. Louis Building and Construction Trades Council look forward to building the next generation of infrastructure for our country, right here in the City of St. Louis. We look forward to working on this 100% Union project while welcoming more residents of the City of St. Louis into life-changing careers in the construction industry," said John Stiffler, executive secretary-treasurer of the St. Louis Building and Construction Trades Council.

"This project will create good-paying union jobs right here in St. Louis, while also generating hundreds of millions of dollars for area public schools. The investments this project will make in our infrastructure, our economy and our future cannot be denied. This is a generational win for the people of St. Louis and a great opportunity for residents to join the construction industry," said Jake Hummel, president of the Missouri AFL-CIO.