Giant building on KBI site just the start
Aligned Data Centers wants to construct three other massive buildings at Hayes and Perkins avenue
SANDUSKY — Residents passing the busy corner of Hayes and Perkins avenues have watched a huge structure rise over the past year. That massive building — under construction on the site of the former New Departure bearing factory — is part of a $200 million-plus high-tech campus being built by Aligned Data Centers. The company broke ground on the first phase of the project, known as NEO‑01, in May 2024.
The site served as a bearing manufacturing plant from 1947-2016. When it closed in 2016, it was being operated by Kyklos Bearing International and was known as the KBI plant.
The site sat vacant since then until Aligned Data broke ground on May 22, 2024, starting a transformation into a digital hub where global companies will house cloud data, artificial intelligence workloads and high-speed internet traffic.
The first building alone is 200,000 square feet — about three football fields — and is designed to deliver up to 96 megawatts of computing power. It’s just the beginning: Aligned has acquired the full 129-acre property and plans to eventually build three other large buildings. Combined, the four buildings will total more than 1 million square feet. So far, only NEO‑01 has been approved and is under construction. The company hasn’t said exactly when it will be finished, but activity is expected to continue into next year.
📦 How much power is 96 megawatts?
The first data center building under construction will use up to 96 megawatts (MW) of electricity — that’s a massive amount of power.
💡 For context:
96 MW = enough to power 75,000–100,000 homes
That’s more than the entire city of Sandusky typically uses
Most of the energy goes toward running thousands of high-performance servers — and cooling them around the clock
âš¡ Because it needs so much power, the company is building its own natural gas power plant on-site instead of plugging into the local grid.
Powering up monster site
One of the most unusual aspects of this project is how it will be powered. Instead of relying on the local electrical grid, the data center will generate its own electricity on-site. Aligned plans to install 15 massive natural gas engines capable of producing 282 megawatts — more than the city of Sandusky typically uses.
The generators are expected to arrive later this year or early in 2027. Company officials say this approach helps avoid delays tied to utility upgrades and gives them more control over energy reliability, especially during peak demand or hot weather.
What about water?
As construction continues on the first data center building, one increasingly relevant question is how much water the project will consume — and where that water will come from. While power usage has been a focal point of local interest, the demands on Sandusky’s water infrastructure remain unclear.
Industry data suggests a facility of this scale could use more than 1 million gallons of water per day if it relies on standard evaporative cooling technology. That’s comparable to the daily water needs of a small city. The center’s co-located natural gas power plant, being built to support the project, may also consume water for steam generation and cooling, adding to the overall draw on local water resources.
But public details are scarce. Local officials and company representatives have not disclosed whether the project will tap into Sandusky’s municipal water supply, rely on groundwater withdrawals, or use more advanced — and water-efficient — cooling technologies.
It’s also unknown whether the company plans to use non-potable or recycled water, or what commitments have been made to conserve or reuse water on site. For now, local residents and environmental advocates are left with more questions than answers, including whether any impact studies have been completed or whether long-term water sourcing and consumption data will be made public.
StayTunedSandusky has made inquiries to township, city and county officials about the and other issues.
Big promises — and big tax breaks
While the project brings new life to an empty industrial site, it’s also supported by significant public subsidies. In December 2023, Perkins Township trustees approved a Tax Increment Financing (TIF) deal that gives Aligned a 70% break on new property taxes for improvements to the site. The remaining 30% will still go to local governments. As part of the deal, Aligned will make a one-time payment of $475,000: $300,000 to Perkins Schools, $150,000 to the township, and $25,000 to EHOVE Career Center. Property taxes on the land itself remain unchanged — the break applies only to new development.
The company also secured a powerful state tax break: a 75% exemption from sales taxes on construction materials and equipment, lasting 15 years. That deal, approved by the Ohio Tax Credit Authority in September 2023, could save Aligned tens of millions of dollars. While the exact figure hasn’t been disclosed, other data centers in Ohio have received exemptions worth over $120 million per year.
The projected employment — the number of jobs — at Aligned Data Centers was projected to be 18 newly created positions, drastically fewer than worked at the site when it was a bearings factory.
At its peak, the General Motors New Departure factory in Sandusky employed approximately 5,000 workers, making it a major local economic driver, according to 2016 trade magazine report.
More modest historical figures from the early 1970s establish that in 1973, the facility employed 2,839 people, rising slightly to about 2,900 in 1975, before reaching its peak of around 5,000 employees.
New Departure opened in June 1947 and saw steady expansion, undergoing corporate transitions — such as merger into the New Departure‑Hyatt Bearing Division in 1965 and later integration into Delphi in the 1990s — before eventually being taken over by Kyklos Bearing International (KBI) in the 2000s.
When it closed in 2016, KBI was employing about 300 people.
Energy and environmental questions remain
Aligned’s use of natural gas instead of traditional electricity service raises ongoing questions about environmental impact. Natural gas burns cleaner than coal but still emits greenhouse gases. The company has said it may purchase renewable energy credits or invest in clean energy projects elsewhere to offset its emissions — a common practice in the data center industry. Ohio continues to rely heavily on fossil fuels, though solar and wind power are slowly expanding.
For now, construction continues, and the scale of what’s happening at the old GM site is becoming hard to miss. With one building nearly enclosed and three more possibly on the way, the corner of Hayes and Perkins is poised to be a key part of Ohio’s digital economy for years to come.
💵 Tax Incentives & Deferred Taxes
Two major forms of tax support are in play:
Property Tax Increment Financing (TIF):
Approved by Perkins Township in December 2023 Policy Matters OhioDatacenterDynamics+4Perkins Township+4Instagram+4.
It’s a 70/30 split—70% of the increase in property taxes goes to Aligned, 30% stays local sanduskyregister.com+5Perkins Township+5YouTube+5.
Includes a one-time payment of $475,000 (with $300K to schools, $150K to township, $25K to EHOVE) Instagram+3Perkins Township+3sanduskyregister.com+3.
Taxes on the existing property continue as usual; only new improvements are deferred Perkins Township.
Sales-Tax Exemption on Equipment and Building Materials:
Approved by the Ohio Tax Credit Authority in September 2023, offering a 75% exemption for 15 years Aligned Data Centers+2Aligned Data Centers+2Policy Matters Ohio+2DatacenterDynamics+3toledoblade.com+3Policy Matters Ohio+3.
This exempts much of the equipment and construction spending from state sales tax.
🧾 How much is deferred?
The $475,000 one-time TIF payment is clearly documented.
The 75% sales-tax break could represent tens of millions, depending on final investment and project costs. Other Ohio data center exemptions have ranged from $123 million to $127 million per year statewide, so this facility’s share could be substantial governing.com+1Policy Matters Ohio+1.