Yahoo Confirms Lockport, NY Data Center

Search engine giant Yahoo confirmed on Tuesday that it will build a 190,000-square-foot data center in the Lockport Industrial Park in Western New York, months after pitching the project.

First proposed last month, the Lockport data center will create 50 to 100 jobs.

The New York state government considers the build a major victory, particularly when factoring in a weak economy where the unemployment rate has significantly risen in the past year in Erie County, from 5.5 percent to 8.1 percent, and in Niagara County from 6.6 percent to 9.3 percent.

Several states including Ohio, Pennsylvania and Illinois had been courting Yahoo for the data center build, with all states offering a generous tax incentives package.

The region designed its own incentive package to entice Yahoo, which included the New York Power Authority offering 15MW of low-cost hydropower. The incentive stands to save the company an estimated $100 million over 15 years.

Other incentives included Empire State Development offering job training grants.

New York Govenor David Paterson and Senator Chuck Schumer also made several personal calls to Yahoo CEO Carol Bartz to pitch the region for the build.

Tom Kucharski, Buffalo Niagara Enterprise president and CEO, said that the region offering a half-dozen sites and not just a single location, as well as a budding relationship between the Yahoo site selection team and the local economic development community, helped contributed to the contract win.

Yahoo says the data center's construction will begin in August and will open by May 2010.

Kucharski said it will use the win as leverage to entice other high tech and high profile companies it is trying to attract.

In addition to Yahoo, high-profile companies like Geico, CitiGroup and Bank of America have either opened or expanded back office operations in the region within the past few years.

Yahoo also announced plans in May to build a $100 million, 150,000-square-foot data center in Nebraska.