AI Is Powering a Desert Construction Boom—and Investors Are Snapping Up Thousands of Acres

A construction boom is taking off in Arizona with thousands of acres of land being snapped up by investors ready to take on technology and AI.

"Typically, 100 acres is the minimum for us. We've been looking at doing large scale data centers," Anita Verma-Lallian, CEO of Arizona Land Consulting, tells Realtor.com®.

Verma-Lallian's company has purchased hundreds of acres of land in the Arizona desert with the sole purpose of building data centers.

"There are a lot of people looking for land, so we try to stay ahead of the competition as much as we can," she explains. "So we try to buy a little bit further out than where existing developments are happening—that's been a little bit of our strategy."

The demand for massive acres of land is increasing as AI continues to integrate into everyday life. In the U.S. alone, more than 5,400 data centers are transforming communities—and in some places, with the promise of jobs. In locations such as Virginia and California, data centers are reshaping once-sleepy communities into technology destinations.

In Arizona, Verma-Lallian explains that Buckeye is one of the fastest growing cities in the state and the location of a future data center.

"There's a good workforce that lives there. A lot of people commute from there, as well. We are creating local jobs which is great for everyone," she says.

Desert developments

Arizona has become one of the top spots for data center developments.

Billionaire Bill Gates is planning to build a $100 million Smart City in the desert community of Belmont—just outside of Phoenix. The Microsoft founder has a vision for a master-planned community with all the technology bells and whistles. The goal is to power the city with renewable energy, such as solar, and have self-driving cars as part of the infrastructure.

The project was first announced in 2017, but it comes with its own set of challenges, such as access to water and managing construction timelines.

Google has also invested $1 billion in a data center near Phoenix. Microsoft and Meta are looking to secure land in the state as well.

"The economic laws of supply and demand apply to land, including land for data centers, which happen to be very in-demand right now," explains Danielle Hale, chief economist at Realtor.com. "When demand is high, it tends to push the price higher, which is why this land seems very attractive as an investment right now."

Real estate investors like Verma-Lallian are aware of how attractive Arizona's land and resources are. She joined forces with venture capitalist Chamath Palihapitiya to close on a $51 million land deal—which is positioned among high-profile neighbors such as Gates, Toll Brothers, and the Howard Hughes Corp.

"The data center we bought with Chamath, it's right next to a smart city that Bill Gates owns. They also recently rezoned a portion of the property to industrial," Verma-Lallian says. "We all just want to see as much development in that area and it helps everybody."

"One thing that's really important to us is we use sustainable technologies and do this in a way that's eco-friendly," Verma-Lallian explains. "We're looking at different cooling technologies. We're looking into companies to invest where they can provide cooling that's more efficient using less water."

She says that they're also looking at using AI to run the data centers more efficiently.

"That's important to us. We want to be as efficient with our resources and to optimize how we're running it."

What are data centers?

Data centers are buildings that house infrastructure and data storage systems that organizations use to store, process, and distribute data.

These systems include servers and networking equipment. Cooling and power infrastructure help to keep the systems running as temperature is a key factor.

The data centers have been attractive to investors and owners because there are tax benefits, including exemptions on equipment purchases and reduced property tax assessments. Other advantages of data centers include strategic land locations.

"We don't have a lot of natural disasters," explains Verma-Lallian. "There's a lot of reasons why Arizona makes a lot of sense for data centers, and which is why we're seeing so many people come here for that reason."

But not everyone who lives near a data center or proposed project is enthusiastic. In Pennsylvania, controversy erupted over a developer who proposed a facility in Blakely, northeast of Scranton. Residents fought hard against it, and local officials heard their concerns.

"I invited the whole neighborhood over to my yard, just to have our first meeting, and we just started meeting from there, we did a lot of research, a lot of writing, a lot of phone calls, to just get all of our facts together that we could,” Brandy Sokoloski of Peckville, PA, told WNEP last month.

After public outcry, the developer dropped plans for the facility.

Unlike Google's success in Arizona, the company recently withdrew its billion dollar proposal for a data center outside of Indianapolis. The project would have converted nearly 470 acres of farmland into a data center campus.

Supporters saw billions in investment, jobs, and tax relief for Franklin Township schools. Critics argued there would not be enough jobs created, the project would place a strain on power and water, and it would provide no tax benefit.

Investor portfolio

For Verma-Lallian, her passion for real estate was inspired by her father.

"My family has a long history of investing in land. My dad's been buying and selling land for 40 years or so," she says.

"Post-COVID, there was this big boom towards industrial development and so we were taking a lot of land that we were traditionally looking at for residential purposes and just looking at it for more of an industrial purpose and with that came data centers."

And her eye for investing isn't just in Arizona, where she was raised. Verma-Lallian purchased Matthew Perry's home in Pacific Palisades, CA, for $8.55 million in October 2024. The home survived the deadly January 2025 wildfires with just minimal damage to the backyard.

For now though, her focus is developing her data center investments in her home state. She's hands on with the project, which includes visiting the site, working with developers, and sharing her input on her vision.

"The site's massive. So, the whole site maybe could be a 10-year project, but we do hope to start breaking ground on phases in the next few years," Verma-Lallian says.