$440M Data Center Planned in Elon Musk’s Austin Suburban Hub

A $440 million data center is going up in Bastrop County, the suburban Austin hub of several of Elon Musk’s companies.

The two-story computer warehouse, listed as “AUS02” in state licensing documents, will have 578,000 square feet of space — about the area of 10 football fields.

It’s the first of four such structures comprising a $1.44 billion campus being built by EdgeConneX, a data center developer out of Herndon, Va., that works with San Antonio cloud-computing firm Rackspace Technology Inc. The project got a 10-year property tax break from Bastrop County in December.

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Construction on the 140-acre complex near Wolf Lane and FM 535 in Cedar Creek is set to begin next month and is expected to be completed by June 2026, according to the filing with the Texas Department of Licensing and Registration.

The builder hasn’t identified any customers, but the complex’s proximity to several Musk operations and vague naming conventions raises questions. Musk’s companies have been investing billions in supercomputers around the country.

Even if it’s not directly related, it’s positioned to support contractors and spinoffs tied to Musk’s companies, along with the region’s fast-growing tech and AI industry. Developers have been rushing to build similar computer farms across the country as AI becomes more intertwined in tech offerings.

Wolf Lane

EdgeConneX has more than 65 data centers in the Americas, Europe and Asia with 15 under construction, including its Bastrop site. It works with Rackspace to provide cloud services in conjunction with its data centers.

The new data center will provide “colocation” services, which provide space where other companies can install their hardware. Such setups help companies to save on infrastructure costs.

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AUS2 and its future neighbors are each expected to pull up to 96 megawatts of power, enough to energize a small town or large industrial facility. Despite their massive size, the complex will create only about 60 permanent jobs with an estimated annual payroll of $5.8 million.

EdgeConnex’s subsidiary, DFW33220N LLC, is building out the complex in four phases. Tax records list as a Delaware-registered company formed last year by affiliates of EdgeConneX.

The county has approved a 75% break on annual property taxes for each phase. EdgeConneX, its companies including DFW33220N, as well as any of that outfit’s affiliates are listed on the abatement agreements as entities eligible for the tax break.

Musk country

Bastrop and Travis counties have become the center of the Musk universe with the Tesla plant and headquarters and X’s headquarters located in the area, along with a manufacturing facility for SpaceX’s Starlink internet service, Neuralink brain implant labs, the tunnel-building Boring Co. and xAI, which focuses on artificial intelligence.

While there’s no direct connection between Musk entities and the data complex that’s about 5 miles from Tesla’s factory and several of his other operations, it’s the type of facility that they could consider using.

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His companies have been investing billions in AI technologies that demand massive computing power. In one example, Tesla is building a supercomputer called “Dojo” at its Austin factory to help its self-driving technologies.

Musk’s xAI, which has nabbed billions in investments, including $200 million from the Pentagon announced this week, has an AI campus in Austin as well as data centers in Memphis and Atlanta.

While Musk has pushed his firms to develop and operate their own data centers, some still lease space from third-party operators and use cloud providers.

For instance, xAI has a deal with Oracle Cloud to help train its Grok chatbot. It’s also looking to rent data center space in Saudi Arabia from Humain, an AI company backed by the Saudi government’s public investment fund.

Texas, especially the Dallas-Fort Worth and San Antonio regions, have seen a boom in data centers due to the state’s relatively cheap energy market, according to the comptroller’s office. As of September, the state had 279 such facilities.