Minnesota’s Northland Enters Data Center Arena with Major Hermantown Campus Approval

Strategic Expansion into Northern Minnesota

The Hermantown City Council has unanimously approved rezoning for what could become one of Minnesota’s most significant data center developments. In a 4-0 vote this week, the council cleared the way for a four-building campus spanning approximately 1.2 million square feet on a 403-acre parcel. This decision marks a strategic shift in Minnesota’s data center geography, which has traditionally concentrated around the Minneapolis metropolitan area.

Strategic Expansion into Northern Minnesota
Project Specifications and Location Advantages
Behind the Development: Players and Partnerships
Community Impact and Economic Implications
Broader Market Context

Local media, including Fox21, first broke the story about the development known internally as Project Loon. The extensive public interest was evident as more than 300 residents attended the six-hour meeting that preceded the council’s decision, highlighting the community’s engagement with this transformative project.

Project Specifications and Location Advantages

The proposed campus will feature four identical structures, each measuring 300,000 square feet (27,870 square meters), creating a substantial technology footprint in the Duluth suburb. The selected location offers several strategic advantages, including proximity to the Arrowhead Substation, which provides critical power infrastructure essential for data center operations.

The site is bounded by Morris Thomas Road to the north, Midway Road to the east, and Solway Road to the west. According to the City of Hermantown’s project documentation, the development represents a $650 million investment that would unfold over an eight to ten-year construction timeline, with work potentially commencing in 2027.

Behind the Development: Players and Partnerships

Real estate firm Mortenson submitted the rezoning application on behalf of Harmony Group LLC, which is acting as the development vehicle for an unnamed Fortune 50 company. The involvement of such a prominent corporation—while still officially confidential—signals significant confidence in the Northland region’s potential as a data center hub., as additional insights

This development represents a notable departure from recent trends in Minnesota’s data center market. Earlier this year, Amazon Web Services withdrew plans for a Minnesota data center, while Meta has maintained its developments primarily in the southern part of the state. The Hermantown project could potentially reinvigorate investor confidence in Minnesota’s broader data center prospects.

Community Impact and Economic Implications

The scale of this project ensures substantial economic impact for the Hermantown and greater Duluth area. The extended construction timeline suggests sustained employment opportunities throughout the build-out phase, while the completed facility will likely create permanent technical and operational positions.

As reported by the Duluth News Tribune, the project has generated both enthusiasm and concern among local residents. The substantial turnout at the council meeting indicates recognition of the project’s potential to transform the local economy while raising questions about infrastructure demands, environmental considerations, and community character.

Broader Market Context

Minnesota’s data center landscape has historically centered around the Twin Cities metropolitan area, where established power infrastructure and fiber connectivity have supported existing facilities. The Hermantown development represents a bold move into relatively uncharted territory for large-scale data center development in the state.

The project’s success could potentially inspire similar investments in northern Minnesota, particularly as companies seek locations with reliable power sources, cooler climates that reduce cooling costs, and available land for expansion. The region’s climate offers natural advantages for data center operations, with cooler temperatures reducing the energy required for facility cooling systems.

As the development moves through subsequent approval phases and toward construction, the industry will be watching closely to see if this project establishes a new paradigm for data center location strategy in the Upper Midwest.