Quantum Loophole and TPG Real Estate Partners (TREP) have acquired a three-square mile site for the development of data centres in the state of Maryland, 50 miles north of Washington DC.

The US$100 million cash transaction was done by the two parties under a joint venture.

The land in Frederick County belonged to the Alcoa Corporation (NYSE: AA)’s wholly-owned subsidiary Eastalco Aluminum Company and once served as the site of the former Eastalco smelter, which permanently closed in 2010 and has already been demolished and 100% environmentally mitigated, according to Josh Snowhorn, Founder and CEO of Quantum Loophole.

Quantum Loophole intends to develop the property into a next-generation data centre community, following the county’s Liveable Frederick Master Plan that calls for new employment and opportunities for local businesses.

Project plans include efficient design for sustainable power and water use, investments in fibre connectivity, a nature first design aesthetic to protect views and reduce visibility from public roadways, and preservation of existing structures important to local history.

Starting with a gigawatt of transmission power capacity, it is anticipated that 30 to 120 megawatt capacity data centre modules can be deployed in less than nine months.

Snowhorn said: “The Eastalco property is ready and ideal for a data centre project of unprecedented scale.

“We are changing the way hyperscale data centre developments are deployed, and this Maryland location has the entitlement, power, water, and proximity to Northern Virginia that the Internet industry needs for success.”

Mark Stiffler, Alcoa’s Vice President for Asset Management, said: “When Alcoa closed the Eastalco site, we made a commitment to bring this property back into productive and sustainable use.

“The sale to Quantum Loophole and TREP is a story of economic and environmental sustainability, taking a former industrial site through the remediation process and bringing it forward for a new industrial use.”

In the second quarter of 2021, Alcoa expects to record a gain of approximately $90 million from this transaction. Consistent with prior transactions, Alcoa reflects gains or losses from non-core asset sales as special items.

Houlihan Lokey is serving as the exclusive financial advisor to Quantum Loophole. Jackson Walker, L.L.P. and David Severn of Offit Kurman P.A. served as Quantum Loophole’s legal advisors.