Company files suit to build 6MM SF server in protected wetlands. But the data center will pay income and property taxes, and the geese don't . . .

Photo above – nearly 1 million Snow Geese overwinter near Delaware City’s wetlands. Unless a proposed 6 million SF data center gets built there.

How big is 6 million square feet? Probably enough for 10,000 affordable housing units. And the location seems nice too – a charming plot of land with scenic views of the Delaware River and Bay. So what’s the problem? The developer wants to put a 1-billion-gigawatt data center there, instead of housing. (see link below). Their request to rezone wetlands into data mining has so far been denied.

The property is already zoned against industrial use. Starwood Digital Ventures (the applicant) argues that a ginormous data center isn’t “industrial”, despite what you may think. In fact they promise to build their own power plant, instead of plugging into the grid and siphoning affordable electrons away from actual people. Since new coal fired electric plants are already prohibited, the data center generators will be fed by either diesel fuel or nuclear fission. Coincidence - both of those need river/port access as well.

Who the heck is Starwood Ventures? No relation to the casino company. They’re a private company that buys and flips distressed shopping malls and hotels. Starwood has been sued previously for loan defaults. Well, everybody makes mistakes, don’t they? That’s why pencils have erasers, and we have courts.

Could the optics on this duck preserve data center get any worse? It depends how you feel about the virtues of AI data mining vs crypto mining. Starwood just inked a contract with MARA holdings, a major player in Bitcoin blockchain. But apparently the proposed Delaware site won’t burn diesel simply to keep the price of Bitcoin up. MARA seems to be exiting the crypto sweepstakes, and wants to go all in on Artificial Intelligence.

Mara holdings is the only player named in this report with a ticker symbol. It’s trading around $8 – near its 52-week low. They went public 4 years ago and immediately skyrocketed to over $75 a share. 90% losses for investors since that date.

I don’t blame companies who are looking for the exit when their business model is built on crypto mining. And I completely understand the investment frenzy around AI (actually, no I don’t). But who the heck are Starwood and MARA building this data center for? Not their personal use, I bet. This has to be a leaseback to giant AI player (Meta, Alphabet, Amazon?) which wants to keep its own profile low. The authors of these links either don’t know who, or aren’t saying.

Delaware – good luck defending your duck preserve. Whether future belongs to AI, Bitcoin, or migratory birds. We’ll be watching to see how this goes.

I’m just sayin’ . . .

Full disclosure - this writer owns no stock shares or has any other financial interest in the companies named in this article.

Starwood appeals denial of permit for data center in NCC | Delaware Public Media

Starwood Capital Group - Wikipedia

MARA’s AI Data Center Pivot: Starwood Partnership Targets 2.5 GW