$100B data center project proposed at Berry Hill megasite advances

Members of the Danville-Pittsylvania Regional Industrial Facility Authority unanimously approved a local performance agreement Monday with Denver-based data center developer and operator Stack Infrastructure for a proposed data center campus at the Southern Virginia Megasite at Berry Hill.

Under the performance metrics in the agreement, Stack will invest at least $73.5 billion at the site and create at least 2,050 jobs at an $80,500 average annual wage. A timeline for the agreement was not available Monday.

However, the company’s planned investment is currently about $100 billion over three decades with 2,500 jobs in two decades.

In a presentation Monday, Matt Rowe, Pittsylvania County‘s economic development director, called the deal “one of the largest single-site investments ever announced in the U.S.”

“You anticipate a multiplier effect of seven times, which means for every job created onsite, you’re looking at an additional six jobs created within the surrounding community,” Rowe said.

Rowe said that if Stack Infrastructure does not meet the job targets in the agreement, it will have to make “monetary payments.” The amount was not specified.

“These are not just a promise for jobs with nothing backing it up,” he said. “There’s real significant money associated with the failure to meet jobs.”

Additionally, if Stack does not meet the provisions of the agreement, Pittsylvania County leaders have the right to change the company’s equipment tax rate.

Pittsylvania County will tax the company at a rate of $1.62 per $100 of assessed value on data center equipment. The funds will be split between the city and the county. The Pittsylvania County Board of Supervisors must still vote on the tax rate.

Pittsylvania’s data center tax rate is within the wide range set by other localities across the state. In Hanover County, for example, data centers pay $0.45 per $100 of assessed value, while in Fairfax County, the tax rate is $4.57 per $100 of assessed value.

“Stack Infrastructure is encouraged and excited by today’s development,” the company said in a statement Wednesday afternoon. “Unanimous approval of the local performance agreement marks a major milestone in the longstanding effort to bring new, community-first economic growth to the Danville-Pittsylvania area.”

What the General Assembly decides in the coming weeks could effectively kill the deal, though.

Currently, the commonwealth has a data center retail sales and use tax exemption on computer equipment. In 2025, that exemption added up to about $1.9 billion.

The budget that the state Senate passed would do away with the exemption. The House’s version would allow it to continue if data centers meet certain environmental standards.

If the exemption were to be cut, a Stack official said the company will pull the plug on the Berry Hill deal, stating that the numbers don’t work without it.

In 2023, the Joint Legislative Audit and Review Commission found the data center industry is estimated to contribute 74,000 jobs, $5.5 billion in labor income and $9.1 billion in gross domestic product to Virginia’s economy annually.

“The benefits from a monetary side for the state, even with the sales and use tax exemption, exceeded by far what the state gave away,” Rowe said Monday.

A decision on the exemption will likely be made soon. Funding for the current biennium budget runs out June 30.

Other details

At the megasite, which is owned by the RIFA, Stack’s data center campus will be built in phases, with the first phase including at least 1,000 acres.

Under the agreement, Stack will provide a minimum annual tax of $16.25 million for 1,000 acres. This allows Pittsylvania and Danville to see financial benefit even if the company is slow to get started on operations.

Those tax payments would likely begin in fall 2027 or 2028, according to a company official who spoke with Virginia Business Monday.

If Stack buys all 2,990 acres of property at the megasite, the company will pay about $48.6 million cumulatively to Danville and Pittsylvania a year.

The touted job numbers for the project don’t include construction workers.

“Construction on this project would occur at the site for the next 12 to 15-plus years,” Rowe said. “We’ll be looking at somewhere between 2,000 to 4,000 plus construction workers on site daily at the height of construction.”

The megasite is in an enterprise zone, a program where state and local governments partner to encourage job creation and private investment. That means Danville and Pittsylvania County must provide an incentive of $1,000 per job created.

Other than that, Stack will not receive financial incentives from Danville or Pittsylvania County for the project, Rowe stressed Monday.

The county will also not offer an accelerated depreciation schedule on the tax rate.

“This appreciation schedule is the same applied to private citizens and businesses for their business personal property,” Rowe said. “A lot of times you’ll see in other communities where they’ll have an accelerated depreciation rate, where it’ll go from pretty much 50% all the way down to 5%, say, over a five-year period.”

Water for the data center is expected to come from the Dan River. The megasite’s infrastructure can provide 7 million gallons of water a day.

“The Dan River at the city of Danville has a daily flow of 331 million gallons per day,” Rowe said. “We had Dan River Mills at one point in time that was yanking out over 15 million gallons of water per day.”

Dan River Mills, which was located by the river in Danville, was once one of the largest textile firms in the South.

When the city isn’t in the midst of a drought, the normal flow of the Dan River is about 1.3 billion gallons per day, Rowe added.

Properties surrounding the megasite use Danville Utilities for electricity. For this project, Stack will enter into an agreement with Appalachian Power.

“Any and all costs associated with providing power to the campus will be paid by Stack Infrastructure,” Rowe said.

A Stack official told Virginia Business that about half of the company’s data centers are used for artificial intelligence. The other half are used for the cloud and other applications.

It’s too soon to say whether the Southern Virginia campus will be entirely for AI use, according to Stack.

When picking a site for a campus, Stack’s leaders look to see whether the community is ready for development, the official said. Residents of Southern Virginia have known for years that eventually a big project would locate at the megasite. For that reason, the official said, the company thinks the community will be more accepting of growth.

Additionally, the official noted that Southern Virginia has a history of enjoying a booming industrial sector, so the data center campus will be replacing an economic loss, rather than bringing new development to the region.

Three local residents expressed concerns about the project at the start of the meeting Monday. Two complained about a lack of transparency among government officials with the project, though Larz Kegerreis, president of a digital marketing firm in Danville, spoke in favor the project, saying that Stack isn’t like other “glory hounds of the tech industry.”

“They know how to build and create data centers better than pretty much anybody in the world,” he said.