Core Scientific Plans to Acquire Alabama Data Center for HPC Expansion
Bitcoin mining and data center operator Core Scientific (NASDAQ: CORZ) has expanded its high-performance computing (HPC) hosting footprint to Auburn, Alabama, by leasing an existing facility from AUBix.
Core Scientific announced on Wednesday that it has become the operator of the facility after signing the lease and plans to exercise an option to purchase the infrastructure. It is estimated to make an initial capital investment of approximately $135 million in the facility, with total investment in the project expected to exceed $400 million.
Core did not disclose specific commercialization plans or revenue projections for the facility but stated it will launch with a capacity of 16 megawatts, with potential for future expansion. It has retained the 11 full-time employees currently at the facility and plans to grow the team to 20 people.
“This facility is expected to play a key role in our high-performance computing strategy,” said Core Scientific CEO Adam Sullivan. Auburn Mayor Ron Anders noted that the city projects Core’s $400 million investment will “result in a local tax generation of $1.5 million per year.”
AUBix is a “multi-tenant, mission-critical” data center in Auburn, featuring a 40,000-square-foot facility, according to its website. Construction of the single-story facility reportedly began in 2021 and was completed in March 2022.
Core Scientific first hinted at its Alabama expansion in its third-quarter earnings report last year. The company signed a lease agreement with AUBix in September for 5.7 acres of land, including the 40,000-square-foot building, which it plans to use for its HPC hosting operations.
According to the filing, the AUBix lease was expected to commence in November 2024, when Core began occupying the leased space. The lease term is 10 years, with the option for Core to extend the term by up to 15 years in five-year increments. Core previously estimated that total future minimum lease payments related to the lease would amount to about $43.5 million.
Meanwhile, Core Scientific’s Bitcoin mining segment continues to face a decline in market share due to rising competition. The company resumed a full “hodl” strategy in January, retaining 100% of its monthly production and increasing its total Bitcoin holdings to over 500 BTC.
