The Shelby County Development Corp. Tuesday (Dec. 16) clarified more of the details regarding the sale of city-owned property on State Road 44 to a data center company.

In an interview with The Shelbyville News, SCDC Executive Director Brian Asher said the city’s Redevelopment Commission approved a letter of intent last week with PINV LLC to sell the land to the company for $57,500 per acre for a total of $7,937,300. The RDC will approve a sale contract with PINV at a future meeting, which is not yet scheduled.

The contract is not quite as simple as it sounds. There are callbacks built into the contract with PINV as a result of previous deals on the property where the companies bought that land and did not build.

Most recently, the RDC bought that land back from Greenleaf at $26,500 per acre after the company chose not to build on that site (this sale to PINV is double that). The RDC was able to do this because they built a callback clause into the sale of the land to Greenleaf when that company bought it in 2019. That clause was included because of another failed development a decade prior, where a company called Krone bought the land, didn’t build, and forced the city and county to buy that land back.

And its for these reasons, these parcels are known as the “Krone” property and the “Greenleaf” property. Asher is referring to it as the Tindall South land in an attempt to avoid any negative energy with this new deal (and TSN will refer to it the same way moving forward).

The letter of intent from PINV was one of two the RDC had received to prep the land for a data center. There are a variety of data centers looking to build at locations all across the U.S. right now because of the growth of Artificial Intelligence.

“One company was getting it ready and then going out to find a data center, and the other one was working with a data center right now,” Asher said. “And you’re seeing this all over the state, not just here, so one that may be in Hancock County or one that may be in Morgan County, they’re not the same one. We’re not all battling for one database, there are multiple looking throughout the United States.”

Data centers are looking to build near large electrical lines, and there is one that runs through the South Tindall property PINV is looking to purchase.

But again, it’s not that simple.

The companies building data centers need to ensure the existing infrastructure can handle the needs of a data center, so they need to complete preliminary work to ensure the parcels are viable. For this reason, this contract with PINV includes probationary periods that would allow for the RDC to reclaim the land in the event the company finds the parcel not suitable.

“Data centers have to work directly with utilities, primarily electric and water,” Asher said. “Mostly electric – it takes them about 12-14 months of due diligence to make sure this is a viable property in order to go forward. This is costly to the company, so the company wants to have control of the land because they don’t want to go out and spend all this money and [run the risk of us selling it to someone else].”

The first probationary period is 9 months, and costs the company a down payment of $100,000. This cost is further broken up into $10,000 due at signing, then two additional down payments of $40,000 and $50,000. It’s written this way so that in the event PINV finds the land unsuitable during that period, the RDC is guaranteed $10,000.

At the end of the nine months, PINV will have the option to extend that probationary period another 9 months for $25,000. If they need to extend it even longer, the contract allows for a third, 6-month probationary period for another $25,000 – for a total of $150,000 down over 24 months.

But Asher does not believe PINV will need the whole 24 months to determine whether or not the land is viable for a data center. Whatever payment the company puts down throughout the probationary period will be knocked off the sale price if they choose to build.

“All indications right now say this spot is a viable project, so this company is looking here,” Asher said. “The RDC is guaranteed $10,000, whether it works out or not. Everything they’re after, once it comes in it will be split [between the city and the county].”

If this infrastructure is approved, the investment dollars that follow will be large, Asher said.

“My assumption would be it’s the largest investment Shelby County has ever had,” he said.