In a significant policy shift, Henrico County officials are taking decisive action to regulate the rapidly expanding data center growth across certain areas of the county.
The move comes amid mounting concerns from residents about the potential impacts of these massive facilities on local communities, particularly in the eastern regions of the county.
The Changing Landscape of Data Center Development
The Henrico Board of Supervisors and Planning Commission have jointly proposed the creation of a White Oak Technology Park Area Overlay District and Technology Boulevard Special Focus Area.
This initiative aims to establish a clear framework for future data center developments while addressing community concerns.
Currently, data centers can be built right in industrial, office, and business districts throughout the country. However, the new regulations would restrict this by-right development to a specific 3,000-acre area encompassing primarily the White Oak Technology Park.
Consequently, any developer wishing to build data centers outside this designated zone would need to obtain a provisional-use permit (PUP), which requires public hearings and board approval.
Balancing Economic Benefits and Community Impact
Supervisor Tyrone Nelson, whose Varina District includes the White Oak area, explained the reasoning behind these changes: “Data centers are a growing industry, and we’re seeing a lot of applications and interest all over the county in these by-right areas.
This doesn’t allow the Board of Supervisors to have a voice in the process, nor our residents. This gives us the opportunity.”
Nelson furthermore emphasized his concerns about concentration: “Ultimately, for me, I don’t want data centers all over Varina.
There’s a lot of M-1 zoning in my district, and I don’t want Varina to turn into a data center capital. This is a way for us to have some say so on each project as it comes forward.”
The Process Behind the New Regulations
The regulations were initiated in late March when supervisors directed the planning department to research and develop new zoning ordinance amendments focused specifically on data centers. Jean Moore.
Henrico’s assistant planning director noted that these changes respond to residents’ concerns following the proliferation of data centers in other parts of Virginia, particularly in Northern Virginia, where localities like Loudoun County have already taken steps to limit further expansion.
Moore defended the changes, stating: “They can be intrusive if they’re not properly regulated. I think Henrico County has done a good job with that, and they’re appropriate in certain areas.
I think Rev. Nelson and the board hear the residents’ concerns and want to make sure that we allow for data centers, because they can be a good use, but in an appropriate location.”
Developer Concerns and Economic Implications
Despite the county’s efforts to regulate data center growth, some developers have expressed frustration with the proposed changes. David Wagner, managing partner of locally based Centra Logistics, has been particularly vocal about his concerns.
A Project Caught in Transition
Wagner’s company had proposed building a 1 million-square-foot data center campus on approximately 200 acres behind the Fareva pharmaceutical facility off Darbytown Road. However, this site falls just outside the newly proposed overlay district, putting the project’s future in jeopardy.
According to Wagner, his firm had met with county officials earlier in the year and received verbal support for their development plan, which included eight data center buildings of 200,000 square feet each.
We sat down with the economic development team in January, presented our high-level plans for the site, and they said they loved it,” Wagner explained.
Centra put the property under contract in March and submitted its plan of development on April 28. However, the new regulations, if approved, would prevent the company from proceeding with the project by right, as their development plan has not yet been approved and would not be grandfathered in.
The Economic Stakes
The timing of these regulatory changes is particularly notable given that tax revenue from data center development has become increasingly important for Henrico.
Just last year, the county launched a $60 million housing trust fund specifically fueled by economic development revenue generated from data centers.
When asked about potential concerns that new rules might discourage data center growth in Henrico, Moore emphasized that the projects would still be allowable across the county—they would simply need to go through the PUP process. “I think the legislation proposed allows reasonable opportunities for data centers where they’re appropriate,” she said.
The Process and Timing Questions
Wagner has expressed concerns not only about the impact on his specific project but also about the speed at which the county is implementing these changes. He noted that the proposed ordinance was posted publicly on May 1, just two weeks before the deciding vote.
“When you go through rushed processes like this, you have unintended consequences,” Wagner said. He also questioned whether the county was playing favorites in drawing up the boundaries of the district, pointing out that 90% of the undeveloped land within the overlay is owned by data center giant QTS and Facebook parent company Meta.
Looking Ahead
As Henrico County moves forward with these new regulations, the balance between economic development and community concerns remains delicate.
The county must navigate the interests of established data center operators, new developers, and residents who may have differing perspectives on the best path forward.
For developers like Wagner, the immediate future remains uncertain. He planned to speak during the public comment period at the joint meeting, hoping that county officials might delay the vote long enough to consider his firm’s situation and potentially create an exception.
