Northern Nevada’s emergence as a data center development paradise recently took another step forward: PowerHouse Data Centers announced plans to build an 84,400-square-foot shell facility on a 49-acre site in the Tahoe Reno Industrial Center.
PowerHouse Data Centers, a wholly owned subsidiary of McLean, Virginia-based American Real Estate Partners, expects to bring the 65-megawatt data center online in late 2025, said Karen Petersburg, vice president of data center development and construction at PowerHouse.
“We love Northern Nevada for many reasons,” Petersburg said. “It’s become kind of a mecca for data center companies and operators that have been there, are going there or are already there. We were really drawn to it for that reason, but also because of the business-friendly aspects of the area. It’s very business-friendly with the tax incentives and they’ve made it very easy for developers with quick approvals.”
PowerHouse Reno is one of the company’s first projects outside Virginia, where PowerHouse is developing more than 700 megawatts of data center buildings in Data Center Alley in Ashburn, Northern Virginia. Located at the intersection of Britain Drive and Waltham Way, PowerHouse Reno consists of three two-story, 300,000-square-foot buildings, each a mirror image of the other. It will have its own substation on site and connect to NV Energy’s power grid, Petersburg said.
General contractor F&P Construction will perform site work and earthwork once the project is complete, Petersburg said. Tectonics Design Group helped PowerHouse executives understand the region’s unique topography and on-site challenges, she added. Key site work challenges include extensive blasting to create level surfaces for vertical development.
“Tectonics and F&P were a great team,” Petersburg said. “They were really able to help us develop the design and layout of the buildings. They knew where the slope was steepest and understood the site’s limitations in terms of square footage because the terrain is so rocky and confusing. They were phenomenal.”
HITT Contracting of Washington, D.C., is the general contractor for the project. Petersburg said PowerHouse worked with several consultants to help the company find the right Northern Nevada subcontractors for its project.
“They help us figure out who the right local players are to look for and get bids from,” she said. “We really try to work with the local communities and the local subcontractor pool first to get the resources and the labor we need to build our facility.”
Northern Nevada is uniquely positioned for the development of additional data centers because of its low electricity costs and strong fiber optic network, Petersburg told NNBW.
“One of the main things we look at when developing sites is where the fiber runs,” she said. “The site of this particular project has both short-haul and long-haul fiber, and the fiber networks there are critical to some of the customers we plan to lease our buildings to.”
“It’s also about power,” Petersburg added. “Reno is a little power hungry right now, but we have 65 megawatts in 2025, so we definitely want to take advantage of that and help our customers right-size their businesses as quickly as possible.”
Karen Petersburg
Potential customers include hyperscalers and AI users, Petersburg added. Ideally, PowerHouse Reno will be leased to a single tenant, but the facility could be divided if needed.
PowerHouse Reno is one of a few companies that have announced plans to build data centers at the Reno Tahoe Industrial Center. Google, Apple and Switch have operated data centers in or near TRIC for years.
Demand for data centers is so strong that new facilities are being snapped up by cloud service providers (also called hyperscalers) as soon as they are completed, Petersburg told NNBW. The unprecedented growth of artificial intelligence is also driving the need for additional computing capacity, she added.
“The demand for AI is so great that the percentage increase is impossible to quantify,” she said. “It’s just skyrocketing, and it’s going to continue to do so until people really understand what AI needs and what that looks like. It’s also a work in progress. The chips are changing, the technology is evolving, and right now the possibilities are basically endless.”
“Problems will arise in the future when we run out of power,” Petersburg added. “Until that happens, the projects will continue to move forward. If you have buildings, land and fiber, it’s a no-brainer; it happens.”
Doug Fleit, co-founder and CEO of AREP and PowerHouse, said in a statement that PowerHouse Reno is an important addition to his company’s growing data center portfolio.
“As the growth of AI across all industries continues to drive demand for hyperscale solutions, sites like PowerHouse Reno will serve the market with short-term power at attractive costs with reliable renewable energy components,” said Fleit.
PowerHouse Reno is a joint venture between PowerHouse Data Centers and Harrison Street, a Chicago-based investment firm focused exclusively on alternative real assets. Michael Hochanadel, managing director and chief digital officer of Harrison Street, said in a statement that expanding the PowerHouse platform to Northern Nevada is an important step in addressing the challenges facing leading technology companies.
“PowerHouse is well positioned to capitalize on evolving customer demands, and our Reno location meets the needs of the market. We look forward to continued expansion throughout the U.S. in the future,” said Hochanadel.
