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Data Centers in Chicago

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Chicago – America's Central Connectivity Hub

Executive Summary

Chicago is a primary US data center market, purpose-built for enterprises that require low-latency connectivity to the geographic center of North America. Its dense network ecosystem and central location are critical for financial trading, logistics, and any business serving a national customer base, ensuring high-speed and resilient application delivery.

Chicago: At A Glance

FactorRating / DataNotes
Global Connectivity GradeA+A top-tier US market with dense national fiber and carrier access.
Direct Cloud On-RampsOver 7 — as of September 2025AWS, Google Cloud (GCP), Microsoft Azure, IBM Cloud, Oracle Cloud.
Power Cost$0.07 - $0.09/kWh — as of September 2025Competitive industrial rates with a growing mix of low-carbon energy sources.
Disaster RiskModerate (49.54) — as of September 2025Primary risks include tornadoes and severe winter weather; minimal seismic risk.
Tax IncentivesYesMultiple state-level tax exemptions and credits exist for qualifying data centers.
Sales Tax6.25% — as of July 2025Illinois state sales tax.

Network & Connectivity Ecosystem

Chicago’s history as a national railway and telecommunications hub has created an exceptional digital infrastructure foundation. The market provides some of the best connectivity in the United States.

Carrier Density & Carrier Neutrality With over 75 unique network providers as of September 2025, the market offers extensive choice. Carrier-neutral facilities, particularly at 350 East Cermak, provide access to nearly every major national and global network, ensuring competitive pricing and high-performance routing.

Direct Cloud On-Ramps Direct, private connections to all major hyperscalers are readily available. The market has over 7 on-ramps providing access to 16 distinct cloud regions as of September 2025. Providers with a dedicated presence include AWS, Google Cloud (GCP), Microsoft Azure, IBM Cloud, and Oracle Cloud.

Internet Exchange Points (IXPs) The Equinix Internet Exchange is the dominant peering hub in Chicago, facilitating the majority of traffic exchange between networks. This centralization reduces latency and transit costs for businesses connecting to partners and customers throughout the Midwest.

Bare Metal Bare metal server options are widely available from multiple providers for workloads requiring dedicated, high-performance compute. Providers like Hivelocity and ColoCrossing offer on-demand server deployments within the Chicago market.

Power Analysis

Average Cost Of Power Industrial power costs in the Chicago area typically range from $0.07 to $0.09/kWh as of September 2025. This competitive pricing helps control operational expenditures for high-density deployments. The state's energy mix includes over 54% low-carbon sources as of 2023.

Power Grid Reliability The power grid serving key data center zones, like the downtown corridor and suburban Elk Grove Village, is well-engineered for high availability. Facilities are commonly supported by redundant power feeds from multiple utility substations, providing a reliable energy supply.

Market Access, Business & Tax Climate

Proximity To Key Business Districts Data centers in Chicago offer low-latency connections to the city's financial district in the Loop, home to major commodity and options exchanges. This proximity is essential for high-frequency trading and financial services applications where microseconds matter.

Regional Market Reach From its central location, Chicago is an ideal hub for serving the entire Midwest and a large portion of the North American population. A deployment here can reach over 30 million people within a 10-millisecond round trip.

Tax Advantage For Data Centers Illinois offers significant tax incentives that directly benefit data center operators and their customers. A 20-year exemption on state and local sales taxes for qualifying data center construction and equipment dramatically lowers the total cost of ownership.

Natural Disaster Risk

Chicago has a moderate natural disaster risk profile, with a Federal Emergency Management Agency (FEMA) National Risk Index score of 49.54 out of 100 as of September 2025. The location avoids the primary threats of hurricanes and significant earthquakes that affect coastal and West Coast markets.

Key risks are primarily weather-related and include:

  • Tornado
  • Winter Weather & Ice Storms
  • Strong Wind
  • Riverine Flooding
  • Hail
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