Two things happened this week at opposite ends of the market, and neither one was good news if you build in the middle. Tucson set its data center permitting trigger at 20 MW or 25,000 square feet. The Town of Tonawanda, New York, deliberately halved its state's 50 MW moratorium threshold down to 20 MW. Meanwhile Hut 8 priced its second investment-grade project bond 20 basis points inside its first, at Baa2, in the same quarter. Construction risk got cheaper for gigawatt sponsors and more expensive for everyone else, in the same seven days.
The squeeze is now explicit. A 20 MW inference deployment in Tucson gets reviewed through the same zoning district as a power plant. That same 20 MW deployment cannot reach the project-bond market, which this week cleared exactly two deals, both north of 300 MW. What's left in the middle is improvisation — and the clearest example of it came from a company that borrowed $30 million against bitcoin collateral at 4.9% to fund a 20 MW retrofit, then hired a bank to sell the whole thing.
The Tripwire Fell to 20 Megawatts, in Two States, Two Days Apart
Tucson's mayor and council adopted the ordinance 6-1 on August 5. The definition of a "large-scale data center" is anything above 25,000 square feet or 20 MW — the disjunctive is the whole story. A 25 ksf, 15 MW pod trips the size test even if it never trips the power test. Anything that trips either one gets routed into a PAD or PCD rezoning, with mailed notice to every neighbor within a half mile, neighborhood associations within two miles, a neighborhood meeting, a Zoning Examiner hearing, and then council. Add a half-mile separation from residences, schools, washes and open space, a 50-foot height cap, 40-foot buffers, an all-frequency independent noise study, and a prohibition on potable water for cooling. Council also directed staff to explore legal pathways to an outright ban.
Two days earlier, the Town of Tonawanda passed Local Law 2-2026 unanimously — a one-year moratorium pegged to 20 MW of peak demand, against New York State's executive-order threshold of 50 MW. Supervisor John J. Flynn, on the record: "there is no back door." The single application caught by it is the Riverview Innovation & Technology Campus on River Road, the former Tonawanda Coke site — a 300 MW project, which is the point. The ordinance was written to stop a 300 MW brownfield conversion and it catches every 20 MW colo build behind it. The developer's response was that this is "an evolving issue, which we will continue to review with legal counsel," which is what you say when you have not decided whether to sue.
The counter-example is in Nebraska. Lincoln County's nine-page draft ordinance, up for a planning commission hearing this week, is the first code I have seen this year that explicitly distinguishes smaller ancillary and edge data centers from hyperscale facilities of 50 MW or more, and sets a 10-acre minimum site size. One jurisdiction out of three wrote the carve-out. That ratio is the risk you are underwriting.
Deal specs. Sponsor: Riverview Innovation & Technology Campus (former Tonawanda Coke site) · Site: River Road, Town of Tonawanda, Erie County, NY — within town limits, immediately N of the Buffalo city line · Footprint: ~500 ksf reported, not confirmed · Load: 300 MW (~600 W/sf if the reported footprint holds — the highest density spec in this issue) · Lease: n/d — no tenant disclosed; application frozen by Local Law 2-2026, one-year moratorium at a 20 MW trigger · Source: BTPM.
Hyperscale Data Hires a Bank: 20 Megawatts, One Neocloud, and a For-Sale Sign
Edge Cases covered the Michigan Center pivot earlier this year, when Hyperscale Data was still describing it as 20 MW with an option to 52. On August 11 the board announced a strategic review of the entire Michigan campus — sale, lease, joint venture, strategic investment, or spin — and retained an investment bank it declined to name. That is the update: the asset is now for sale, and it is the only genuinely in-band asset in the country with a sale process running this week.
The numbers are worth the arithmetic. Twenty megawatts of contracted critical compute inside a 60,000-square-foot retrofit pencils to 333 W/sf. The master services agreement runs ten years with two five-year extensions and is worth more than $1.2 billion at max term — which is $250 per kilowatt-month. Do not put that next to Riot's number and call it a premium. Riot's is a build-to-suit lease; this is a gross services rate with power and opex baked in. The spread is the opex load, not the pricing. The number that actually matters here is the retrofit capex: $100–120 million for 20 MW, or $5.0–6.0M per MW, against TeraWulf's published greenfield guidance of $8–10M per critical IT MW. A 40% basis advantage is the entire argument for the conversion trade at small scale, and this is the first clean print of it.
The financing is the tell. On August 3 the company established a bitcoin-collateralized borrowing program through Morpho and drew roughly $30 million at 4.9% to fund the Michigan build. Against construction debt at SOFR plus 250 to 400, that is cheap money — and it is also an admission that conventional construction debt does not reach a 20 MW asset with an unrated private tenant on competitive terms. The counterparty is an unnamed California neocloud. That is the weak link, and it is presumably why the bank got hired.
Deal specs. Sponsor: Hyperscale Data, Inc. (NYSE American: GPUS), via Alliance Cloud Services LLC · Site: Michigan Center, Jackson County, MI — ~5 mi E of Jackson city limits · Footprint: 60 ksf retrofit (existing mining shell, ~28 MW of bitcoin load being reallocated) · Load: 20 MW contracted, option to 52 MW (333 W/sf at 20 MW) · Lease: 10-yr master services agreement + two 5-yr extensions; gross services structure, escalator n/d; unrated private California neocloud tenant · Deal value: >$1.2B at max term (~$250/kW/month gross); retrofit capex $100–120M (~$5.0–6.0M/MW) · Source: SEC 8-K.
$154.67 to $198.52: The Build-to-Suit Tape, and the One Number Everyone Will Misread
Three large leases printed in this window, all of them well over 75 MW. They earn their place here for one reason: they are the comps every sub-75 MW deal is about to get measured against, fairly or not.
Riot Platforms set the ceiling. A 20-year build-to-suit at Rockdale, Milam County, Texas — 191 MW of critical IT for $9.1 billion through June 2048, with two five-year extensions that take it to $16.1 billion. That is $198.52 per kilowatt-month on the base term. Riot also disclosed cumulative NOI of $7.3–8.2 billion, which is an 80–90% margin on contracted revenue, and $1.91–2.15 million of NOI per MW per year. Riot did not name the tenant; Bloomberg and DCD report it is Anthropic. Delivery is phased — first 96 IT MW in December 2027, the balance by June 2028 — and Riot is carrying a $573 million interim facility from Morgan Stanley while it finalizes an investment-grade credit backstop.
Hut 8 set the floor at $154.67 per kilowatt-month on a 352 MW Beacon Point lease worth roughly $9.8 billion. The more useful disclosure was on the debt side: $3.25 billion of senior secured notes for River Bend, which Hut 8 calls the first investment-grade construction financing for a single-sponsor data center project, followed by $4.25 billion for Beacon Point Phase 1 at Baa2, priced 20 basis points inside the first deal. Both fully amortizing, both non-recourse to the parent. Construction risk repricing that fast, inside one quarter, is the signal — it eventually drags mezzanine and private-credit quotes down for everyone, but it reaches gigawatt sponsors first and the middle of the market last.
Then there is Fermi, which is the number that will get copy-pasted wrong. The TensorWave lease at Project Matador reads as 222 MW for $6.5 billion over 15 years, or $162.66 per kilowatt-month. Except the 222 MW is total facility power, not critical IT; the 15-year clock does not start until the final delivery phase commences; and the lease is expressly conditioned on receipt of project guaranties and financing that have not closed. Three haircuts on one headline. If critical IT runs 70–75% of facility power — a rule of thumb, not a Fermi disclosure — the implied critical-IT rate is closer to $217–232. Label it an estimate or leave it out.
Deal specs. Sponsor: Riot Platforms, Inc. (NASDAQ: RIOT), landlord · Site: Rockdale campus, Milam County, TX — ~60 mi NE of Austin · Footprint: n/d · Load: 191 MW critical IT, Tier 3 build-to-suit (density n/d — no square footage disclosed) · Lease: 20-yr initial through June 2048 + two 5-yr extensions; escalator n/d; tenant unnamed by Riot, reported as Anthropic; IG credit backstop being finalized · Deal value: $9.1B base / $16.1B with extensions (~$198.52/kW/month; $47.6M/MW over term) · Source: Riot Q2 2026 release.
One Megawatt in Pittsford, New York, for About $1.1 Million
The only closed asset trade in the band this week was very small, and that is exactly why it is useful. Carrier Connect Data Solutions closed on Rochester Colo on August 4 — a 36,000-square-foot building at 1100 Pittsford Victor Road, eight miles southeast of downtown Rochester, with 7,000 square feet of live white space carrying 1 MW and room to take it to 15 ksf and 4 MW.
Consideration was 800,000 common shares plus $250,000 cash, with the shares escrowed and released in four equal tranches at six, twelve, eighteen and twenty-four months. Against the $1.12 option strike the company set the same day, that implies roughly $1.15 million all-in, or about $1.1 million per live megawatt — call it $287,000 per MW against the 4 MW ceiling. Density on the white space is 143 W/sf; on the gross building it is 28. Neither number is impressive, which is the point: this is a Tier II/III carrier-neutral box with an existing customer base, not an AI deployment, and it traded at a price that reflects that. If you are pricing a sub-5 MW colo asset in a secondary metro, this is your 2026 comp, and it may be your only one. The buyer has declared a US roll-up strategy, so there should be more.
Deal specs. Sponsor: Carrier Connect Data Solutions Inc. (TSX.V: CCDS), via PureColo Inc.; seller Rochester Colo, LLC · Site: 1100 Pittsford Victor Rd, Pittsford, Monroe County, NY — within Pittsford, ~8 mi SE of downtown Rochester · Footprint: 36 ksf building; 7 ksf live white space, expandable to 15 ksf · Load: 1 MW live, 4 MW potential (143 W/sf on live white space; 28 W/sf gross; 267 W/sf at full buildout) · Lease: asset purchase, not a lease — APA dated June 8, closed Aug 4, 2026; arm's length; operating asset with existing customer base · Deal value: 800,000 shares + $250,000 cash, shares escrowed in four tranches over 24 months (~$1.15M implied, ~$1.1M per live MW) · Source: DCD.
Two Planning Votes on August 4, Two Councils on August 18, and a New Price of Admission
Both of these campuses are over 75 MW. They are here because between them they reset what a developer is expected to hand a municipality — and that expectation now applies to the 20 MW applicant standing behind them in line.
PowerHouse Data Centers, a division of American Real Estate Partners, cleared Westlake, Texas planning and zoning on August 4 for a four-building, 1.2 million-square-foot campus at 300 MW on 88 acres at US 377 and Westport Parkway. The site plan is unremarkable at 250 W/sf. The entitlement is not. PowerHouse paid Oncor to build a 350 MW switchyard at no cost to residents, sized 50 MW above its own need, with the surplus 50 MW carved out for the Town of Westlake and the town pump station running off it. Call it a power dowry. It came bundled with 8-foot sound walls along the entire southern boundary, a 220-foot landscape buffer, three-inch-caliper evergreen screening, and 506 feet from the building to the nearest residential property line in Keller. There is no tenant disclosed and no construction permitted until a development agreement passes council on August 18.
On the same day, 900 miles east, Statesboro's planning commission voted 5-1 to recommend rezoning 26.94 acres at 6539 Burkhalter Road for a two-story, 230 ksf box asking Georgia Power for up to 99 MW. That is 430 W/sf — the highest computable density in this issue, and a spec that tells you this is purpose-built AI, not enterprise colo, squeezed onto roughly a tenth of the acreage a 99 MW campus normally consumes. The applicant is eating closed-loop cooling, mandatory city water and sewer, a 50 dB property-line noise cap, a decommissioning plan, and a separate special use permit after the rezoning. Bulloch County, meanwhile, has a moratorium running to December 31 and is drafting an outright ban — city and county moving in opposite directions on the same tax base.
Deal specs. Sponsor: PowerHouse Data Centers / American Real Estate Partners; titled owner Circle T Owner LP · Site: 13580 Denton Hwy at US 377 & Westport Pkwy, Westlake, Tarrant/Denton counties, TX — within Westlake town limits, abutting Keller; ~2.3 mi from Meta's Alliance campus · Footprint: 1,200 ksf across four 300 ksf buildings on 87.96 acres · Load: 300 MW (250 W/sf) · Lease: n/d — no tenant disclosed; first building by-right, successive buildings require SUP; development agreement pending Aug 18 · Interconnect: 350 MW Oncor switchyard funded by sponsor, 50 MW surplus carved out to the town · Source: DCD.
Deal specs. Sponsor: 4AM Development LLC (Bobby Bagwell, Charles C. Way); agent Thomas & Hutton · Site: 6539 Burkhalter Rd, Statesboro, Bulloch County, GA — within Statesboro city limits, ~50 mi NW of Savannah · Footprint: 230 ksf across two stories on 26.94 acres, plus a 32 ksf substation · Load: up to 99 MW requested from Georgia Power (430 W/sf — request is not an approval) · Lease: n/d — no tenant disclosed; unrated private developer; rezoning R-4 to O recommended 5-1 Aug 4, council Aug 18, separate SUP still required · Source: Statesboro Herald.
What to Watch Next Week
Two councils, August 18. Westlake votes on the PowerHouse development agreement — watch whether the 50 MW town carve-out survives into the executed document, because that is the clause every subsequent applicant will be handed as a template. Statesboro votes on the Burkhalter Road rezoning at 5:30 p.m., and a yes still leaves a special use permit to win.
Soluna's first-ever earnings call, Thursday August 13. The live item is Project Kati 2 in Willacy County, Texas — an LOI with a single prospective tenant is signed and the company says it is finalizing design, commercial terms and the lease. A first-lease print from a small sponsor would be a far more relevant comp than anything Riot or Hut 8 disclosed this quarter.
WhiteFiber, Wednesday August 12, and Fermi, Thursday. WhiteFiber is guiding to 76 MW gross by year-end, which puts the whole company inside this newsletter's band; watch for lease signings and any $/kW disclosure. Fermi should face pressure to disclose the critical IT figure behind the 222 MW facility-power number, and the status of the guaranties the TensorWave lease is conditioned on.
Riot's takeout of the $573 million Morgan Stanley bridge. Whatever spread the permanent investment-grade financing prints at, measured against Hut 8's Baa2 benchmark, is next quarter's most important number for anyone financing a contracted build-to-suit at any size.
Recall petitions in Augusta Township, Michigan. Voters overturned a unanimously approved 522-acre Thor Equities rezoning by referendum on August 4, 2,314 to 269 — 89.5% against. Petitions are now under signature review against all seven trustees for a possible November ballot. Price the post-approval reversal window into anything you underwrite in a referendum-eligible jurisdiction.
Disclaimer: Edge Cases is Barrio Energy's deal-flow product. Nothing here is investment advice, a recommendation to transact, or a substitute for your own diligence. Specs are sourced from public filings, press, and reporting; verify before you wire anything.
