Medina County, Texas, December 26, 2025
Microsoft Corporation plans to construct a new data center in Medina County, Texas, approximately 5.5 miles from Castroville. Covering 195,670 square feet and costing around $400 million, the colocation facility will serve to meet rising demand for cloud services. The construction is set to begin soon, with completion by July 2028, and is expected to generate significant economic benefits for the local community despite infrastructure concerns.
San Antonio, Texas – Microsoft Expands Data Center Operations with New Facility Near Castroville
Microsoft Corporation is set to build a new data center in Medina County, Texas, approximately 5.5 miles outside of downtown Castroville. The planned facility will cover 195,670 square feet and is projected to cost around $400 million. Construction is expected to commence in the near future, with completion slated for July 2028. This development marks a significant expansion of Microsoft’s data center presence in the San Antonio area, where the company has already acquired substantial land holdings and established multiple facilities.
Details of the New Data Center
The upcoming data center will be a colocation facility, allowing Microsoft to lease space to other companies. This approach aligns with Microsoft’s strategy to support the growing demand for cloud services and artificial intelligence infrastructure. The choice of location in Medina County is strategic, offering access to essential power and fiber infrastructure, as well as a flat topography conducive to large-scale data center operations.
Microsoft’s Expansion in the San Antonio Area
Microsoft’s investment in the San Antonio region is substantial. The company has acquired over 1,000 acres in Medina County and more than 300 acres in Bexar County. Notably, Microsoft recently purchased 90 acres off the intersection of Wiseman Boulevard and Loop 1604 on the West Side of San Antonio, indicating plans for further expansion in the area. These acquisitions underscore Microsoft’s commitment to enhancing its data center capabilities to meet the increasing demand for cloud computing and AI services.
Impact on the Local Community
The construction of the new data center is expected to have a significant economic impact on the local community. The project will create numerous construction jobs and, once operational, will provide ongoing employment opportunities. Additionally, the presence of such a large-scale facility is likely to attract related businesses and services to the area, further stimulating economic growth. However, local officials and residents have expressed concerns regarding infrastructure demands, particularly related to power supply and water usage, as well as potential traffic increases due to construction activities.
Background on Microsoft’s Data Center Strategy
Microsoft’s expansion into the San Antonio area is part of a broader strategy to build and operate data centers that support the company’s cloud computing and AI initiatives. The company has been actively investing in data center infrastructure to meet the growing needs of its customers and to stay competitive in the rapidly evolving tech industry. By establishing a significant presence in San Antonio, Microsoft aims to leverage the region’s favorable business environment, access to resources, and strategic location to enhance its service offerings.
FAQ
What is the size and cost of Microsoft’s new data center near Castroville?
The new data center will cover 195,670 square feet and is projected to cost around $400 million. Construction is expected to commence soon, with completion slated for July 2028.
Where is the new data center located?
The facility is located approximately 5.5 miles outside of downtown Castroville, in Medina County, Texas.
What is a colocation facility?
A colocation facility allows companies to lease space within a data center to house their own servers and networking equipment, rather than building and maintaining their own data centers.
How does this expansion impact the local community?
The construction of the new data center is expected to create numerous construction jobs and provide ongoing employment opportunities once operational. However, there are concerns regarding infrastructure demands, including power supply, water usage, and increased traffic due to construction activities.
Why is Microsoft expanding its data center operations in San Antonio?
Microsoft’s expansion in San Antonio is part of a broader strategy to build and operate data centers that support the company’s cloud computing and AI initiatives, leveraging the region’s favorable business environment and access to resources.
Key Features of Microsoft’s New Data Center Near Castroville
| Feature | Details |
|---|---|
| Location | Approximately 5.5 miles outside of downtown Castroville, Medina County, Texas |
| Size | 195,670 square feet |
| Estimated Cost | $400 million |
| Construction Timeline | Expected to commence soon, with completion slated for July 2028 |
| Facility Type | Colocation facility |
| Microsoft’s Local Land Holdings | Over 1,000 acres in Medina County and more than 300 acres in Bexar County |
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