Most commercial real estate brokers spend the first ten minutes of a site visit looking at the ceiling height and the loading docks. Logan Freeman, founder of Kansas City-based Midwest CRE Advisors, spends his time looking at the electrical room. That difference is why his firm is closing edge data center transactions in secondary Midwest markets while most brokers are still working out what an inference facility is.

Freeman has developed a repeatable evaluation process for industrial buildings being considered for edge data center conversion. It starts before he walks through the front door.

The first thing Freeman looks for when approaching a site is external utility infrastructure: a transformer pad, a substation, and the service entrance size. Those answers determine whether a building is worth a closer look before he steps inside.

“If I see a 2,000-amp service on a 40,000-square-foot building, I’m interested,” he explains. “If I see a 400-amp panel, I’m moving on unless there’s a clear utility upside story.”

Once inside, his first stop is the electrical room. He examines the switchgear, panel configuration, and existing load capacity – not just what is there, but what it would cost to upgrade. A building with marginal power but a nearby substation and known expansion headroom presents a different investment case than one with marginal power and no upstream capacity to draw from.

Data center equipment is heavy, and most industrial buildings are not built to handle it. A standard warehouse floor rated for 125 pounds per square foot falls short of what edge data centers require: 200 to 300 pounds per square foot. When structural capacity is not there, remediation costs can make an otherwise promising building unworkable on the numbers.

Clear height matters too, but differently than it does for distribution warehouses. For a small to mid-size data center, 12 to 16 feet is sufficient. More important is column spacing. Data center operators arrange rows of cabinets across open floor space, and obstructions create layout problems that are difficult to design around. Column-free or wide-bay floor plans command a premium for that reason.

HVAC and cooling infrastructure are the third area Freeman examines. He looks for raised floors, existing HVAC units, and any history of the building being used as a critical-environment facility.

Former telecom central offices and switching facilities are particularly valuable. They were built for continuous, 24-hour operation and often already have battery rooms, generator connections, and redundant cooling systems in place. “They were designed for 24/7 uptime,” Freeman says. “They often already have battery rooms, generator connections, and redundant cooling infrastructure built in.”

Buildings with that kind of prior use can bypass years of fit-up work and millions in capital expenditure. With supply chain delays pushing lead times on critical equipment such as behind-the-meter turbines to 24 to 36 months, starting with infrastructure already on site can compress a deployment timeline by two years or more.

Beyond power and structure, Freeman checks fiber entry points and road access for equipment delivery. Both matter, but neither is the issue that most often kills deals.

“I’m always looking at the roof,” he says. “Prior water intrusion on IT equipment is a conversation stopper.”

“A thorough walkthrough for a serious prospect takes about an hour,” Freeman says. “I bring specialists in electrical, structural, and mechanical systems with me. By the end of that hour I have a pretty clear picture of whether the adaptive reuse story is a two-million-dollar fit-up or a twenty-million-dollar gut renovation. Those are very different conversations.”

The developers who get it right are also asking a third question beyond the building itself: how well can we document this transformation? The firms pulling ahead are treating every completed deal as a dataset for the next one – project history, coordination records, and site documentation carried forward rather than filed away at closing.

The broader principle Freeman applies across every market he operates in is this: the question to ask about an old industrial site is not what the building is, but what it is connected to. Most buyers only think to ask the first question. The ones asking the second are the ones finding the deals.

For closed deal examples and more on Midwest CRE Advisors’ approach to edge data center site selection, visit their client success stories.

Midwest CRE Advisors is a Kansas City-based commercial real estate firm specializing in edge data center site selection, industrial outdoor storage, and traditional CRE investment across the Midwest. The firm works with infrastructure developers, investors, and landowners across Kansas, Missouri, Oklahoma, Nebraska, and Iowa.

This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.

Disclosure: Individuals or companies mentioned may have a commercial relationship with KeyCrew.

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