Blackstart Digital, a data center development and investment firm, has entered into an agreement to acquire the former IBM Almaden Research Center in the Coyote Valley hills of South San Jose. The agreement for the 650 Harry Road site is expected to close by the end of the year.
The acquisition follows an August decision by the San Jose City Council to rezone the property. This action raised concerns from residents and environmental advocates about attracting more data centers to the region before specific uniform standards for such facilities are established.
The property encompasses seven buildings with over 500,000 square feet within a 35-acre industrial park. Blackstart Digital does not intend to develop the surrounding 565 acres of open space, acknowledging their importance to the community for trails and hillsides, according to a company spokesperson. The spokesperson stated that Blackstart Digital's first goal is to restore the campus for use in a way that respects its history.
Blackstart Digital plans to transform the campus into a model for sustainability and safety. This involves implementing closed-loop cooling systems, advanced battery safety measures, noise mitigation strategies, and software designed to reduce energy consumption during peak demand. The company spokesperson highlighted potential benefits for the region and its residents, including creating construction and skilled jobs, supporting local businesses, and generating tax revenue for San Jose’s general fund.
The campus currently features an on-site 25-megawatt substation and includes multiple existing data center facilities where Blackstart Digital intends to expand capacity, subject to power availability. A company spokesperson confirmed that any development proposals would undergo appropriate environmental review under the California Environmental Quality Act (CEQA) and involve a public process with San Jose, residents, and conservation groups.
Marika Krause, a spokesperson for the San Jose Planning Department, confirmed that Blackstart Digital requested the city complete an environmental review in June to finalize the rezoning process. Krause added that no other application concerning this property has been filed. Once an application is submitted, the city will determine the appropriate environmental review based on the submitted materials and any scope of work prepared by an environmental consultant.
During the August 18 council meeting where the property was rezoned, residents and environmental organizations urged officials to delay the action until future development plans were clear and consistent standards for data center projects were in place. Councilmember George Casey, whose District 10 includes the former IBM site, expressed a desire for the land to be economically viable and saw no reason for delay.
Environmental groups, including the Sierra Club, California Native Plant Society, and Mothers Out Front, conveyed their concerns in a joint letter to the city council. They noted that the rezoning could be significant because Senate Bill 131 exempts advanced manufacturing facilities on industrially zoned land from CEQA review. The letter emphasized that residents deserve full transparency and consideration of the legal, environmental, and land-use implications of the rezoning.
Alice Kaufman, policy and advocacy director for Green Foothills, voiced strong concerns about the possibility of a data center locating on the site. Kaufman pointed out that the 565 acres of open space surrounding the former IBM campus are primarily serpentine grassland, which supports rare native plants and those vital to the threatened Bay checkerspot butterfly. She added that serpentine grasslands are particularly susceptible to nitrogen deposition, making the potential for diesel backup generators in a data center to emit nitrogen oxides and other pollutants a serious concern. Kaufman also warned that other impacts from industrial use, such as noise, nighttime lighting, and human activity, could significantly affect the site’s ecology and its function as an important wildlife corridor, potentially impacting animal movement in the area.
The IBM campus was originally built for research and retains features that support a wide range of uses, including advanced research and development, startup incubation, academic partnerships, quantum computing, and digital infrastructure.
