Data Centers Are Coming to NEPA—What Investors Should Watch
Northeast PA is hearing a different development conversation--not just warehouses or logistics. Now it's data centers.
Amazon Web Services announced a major investment in Pennsylvania for AI and cloud infrastructure, with Luzerne County and Bucks County named as early locations.
Separately, Hazle Township has been dealing with the large Project Hazelnut proposal near Humboldt North Industrial Park. It’s describes as a phased data center campus, with up to 15 buildings on roughly 1,280 acres, plus the electrical infrastructure needed to support it.
So the local question is (no surprise): What does this mean for residential values, landowners, and investors?
Like most things real estate, the answer is as simple, or complex as people want it to be. Some folks hear “data center” and think property values are going to get destroyed. Others hear “Amazon” or “AI infrastructure” and assume everything nearby is going to the MOON!
I think both reactions are a little too exaggerated. The better answer is more boring: It depends. It depends on location, zoning, infrastructure, roads, the water, the power, and how close a property is to the actual ground zero.
Northern Virginia is the best comparison, because it’s the largest data center market in the world. George Mason University analysis of 2023 home sales found no evidence that, on average, homes closer to data centers sold for less.
But the key words there are “on average.” That doesn’t mean a house sitting right next to a noisy industrial use is automatically fine. And not every rural road suddenly becomes more valuable.
And it absolutely does not mean investors should start buying land blindly because a data center was announced nearby.
What it means to me is the knee-jerk reaction may be too simple. For investors and landowners, I’d be watching three things.
First, zoning. Don’t just look at where the data center is going. Look at the surrounding parcels. What’s residential? What’s industrial, and agricultural? Composition of already-existing structures inside or near a business park? Think about what land could realistically be rezoned?
Second, water and environmental permitting. If you’re looking at raw land or nearby residential pockets, pay attention to DEP filings, water withdrawal questions, wastewater capacity, stormwater plans, and township meeting notes. That stuff is not exciting, but it tells you way more than a press release.
Third, utility infrastructure. Since data centers need serious power, that signals substations, transmission lines, fiber routes, access roads, sewer and water expansion, and grid upgrades. They’re all in play. Sometimes the land benefiting most isn't the closest land to the project. It’s the land near the infrastructure that follows the project.
Investors—don’t miss that part: The headline project is important, but the second wave usually matters more. Think picks/shovels. Where do workers live? Which roads get improved? Which parcels become more ‘useful’ because utilities get extended?
And, which neighborhoods become less desirable when they get the noise, traffic, or visual impact? Logically following: sellers will get more motivated when the area is changing faster than they’re comfortable with--that’s where the investor work is.
My take?
Data centers won’t automatically save or ruin nearby residential values. They’ll create winners and losers block by block, parcel by parcel, and township by township.
For buyers, slow down and study the maps. For landowners, I’d be careful about making emotional decisions based on rumors. For investors, watch the infrastructure, not just the headline announcement.
The press release gets the attention; but zoning, utilities, water, roads, and buyer behavior are where the money is made or lost.