Prologis sues Trenton in federal court nine days after voters banned its data center
Nine days after Trenton voters banned large data centers, Prologis is testing in federal court whether permits issued before a vote can override it, and the answer prices political risk for every data-center landlord.
Vincent Jiangtwo-minute read
Trenton, Ohio, voted nearly 80% on Nov 1. 3 to amend its charter and ban any data center drawing more than 25 megawatts 1. Nine days later the developer building one there sued in federal court to keep its project alive.
Forty-two million dollars already in the ground
Trenton Data Center Campus LLC, an affiliate of San Francisco-based developer Prologis+0.09% — Prologis, up 0.09 percent today (NYSE: PLD), has spent more than $42 million on a 145-acre site along Kennel and Woodsdale roads, planned for four buildings totaling nearly 1 million square feet and up to 500 megawatts 123. The city issued zoning certificates and building permits months before the vote 2. The suit argues those rights "vested" before Election Day, and that the city cannot "change the governing rules after the fact to revoke what it already authorized" 12.
No Ohio court has settled when a project this size vests
Prologis already lost an Ohio Supreme Court bid to keep Issue 17 off the ballot 1. On Nov. 9, attorneys for Trenton taxpayers demanded the zoning certificate be revoked; on Nov 1. 12 the city's law director wrote "the city will actively defend this action," with results not yet certified 1. No Ohio court has settled when a project this scale vests, and residents' lawyer Nick Owens of Conserve Ohio points out construction so far is site work: no servers, no power connected 4.
The precedent travels. Voters in 10 other Ohio communities passed similar restrictions the same night 1, and Cipher Digital−6.85% — Cipher Digital, down 6.85 percent today (CIFR) fell roughly 20% on Nov. 4 after Texas elected a governor who campaigned on a data-center moratorium 5. Markets are charging political risk on every permitted campus, and this suit is the first test of whether that risk can strand built capital. If Prologis's vested-rights claim holds, the discount is too wide; if the ban holds, referendum-friendly towns become stranded-capital zones for every operator, PLD to Cipher.
Three decisions will settle this, and none is scheduled
Butler County certification, the city's ruling on the Nov. 9 revocation demand, and the first court date. The money answer comes before the legal one.
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