In Mason County, Kentucky, three men offered a family doctor $10 million for his 250-acre farm. They would not say who was funding the purchase. The only way to learn more was to sign a nondisclosure agreement.
Data center developers deploy the same legal tools for decades used in real estate to obscure billions in land acquisitions before communities can respond
THOMAS URBAIN / Getty Images
In Mason County, Kentucky, three men offered a family doctor $10 million for his 250-acre farm. They would not say who was funding the purchase. The only way to learn more was to sign a nondisclosure agreement.
The offer, which represented 35 times what the landowner had paid for the property in 1988, came with no disclosure of the buyer's identity, according to an NBC News investigation. That opacity is not an anomaly. It is the standard playbook for how data center developers acquire land across the U.S., part of a broader land rush shaped by electricity access, water rights, and fiber connectivity rather than by population or jobs.
Data center land deals rely on a set of interlocking legal mechanisms. The most common are shell LLCs, nondisclosure agreements between developers and local officials, land options that lock up parcels before public review, and intermediary buyers who negotiate on behalf of unnamed principals.
Shell $SHEL LLCs are the foundation. In real estate, shell companies are created to hold property on behalf of real owners, and it can be difficult to determine those owners from public records. In states such as Delaware and Nevada, individuals can form a shell company without disclosing the names of its owners or directors.
The practice is well-documented in data center acquisitions. In Arkansas, two Delaware-based entities, Willowbend Capital LLC and Forgelight Ventures LLC, both managed by the same individual, Michael Montfort, served as front companies for projects later revealed to be for Google $GOOGL, according to the Arkansas Democrat-Gazette. Willowbend Capital submitted permit applications on Google's behalf while the tech company's name remained absent from public filings.
NDAs extend the veil further. NBC News found that a review of more than 30 data center proposals across 14 states showed that in a majority of cases, local officials signed NDAs and worked with apparent shell companies. Those NDAs can extend for years beyond the initial proposal dates and often include clauses requiring local jurisdictions to limit record disclosure. A separate study cited in the same report found that 25 of 31 Virginia localities with proposed or existing data centers had NDAs in place.
The agreements can be broad. In West Memphis, Arkansas, one NDA defined "confidential information" to include financial statements, cost data, and business plans, and required the city to assert all available Freedom of Information Act exemptions to withhold records, according to the Arkansas Democrat-Gazette.
The logic is straightforward and, from a buyer's perspective, rational. When a major company's identity is known, land prices rise.
The template is old. To avoid a land speculation boom in the 1960s, Walt Disney $DIS Productions used various dummy corporations to acquire 27,443 acres in central Florida, purchasing the land from 51 owners for more than $5 million, at an average price of $182 per acre. Once Disney was identified as the buyer, land prices in the area jumped more than 1,000%.
Data center developers face the same dynamic. In central Ohio, farmland once priced at $30,000 per acre now exceeds $150,000 when rezoned for data center use, according to Datacenters.com. Prices for parcels of 50 acres or larger rose 23% from 2023 to 2024, according to Cushman & Wakefield's U.S. Data Center Development Cost Guide. With hyperscalers often assembling sites of hundreds of acres, any leak about their identity can add tens of millions to the total cost.
According to McKinsey, both hyperscalers and real estate developers engage in "land banking," acquiring land in desirable locations five, seven, or even ten years before building, with many holding hundreds or thousands of acres in reserve.
The competitive dimension matters, too. A developer scouting a site does not want a rival to learn about its interest and bid up the same parcel or a neighboring one. NDAs with local officials prevent leaks during due diligence.
The same mechanisms that protect buyers leave communities with limited information about projects that will reshape local infrastructure. Data centers consume large quantities of electricity and water, generate noise, and can alter property values. Their public benefits, while real, are narrow: A hyperscale facility costing billions may employ about 30 permanent workers once operational.
In Pine Island, Minnesota, city officials knew about a proposed data center for two years before residents were informed, due to NDAs they had signed, according to testimony reported by Governing. In Wiscasset, Maine, plans for a $5 billion data center were developed without public transparency, and the community lost $240,000 in federal housing funds tied to the same parcel, as reported by the Daily Yonder.
Some officials who sign NDAs describe them as standard economic development practice. Jay Chesshir, president and CEO of the Little Rock Regional Chamber of Commerce, told the Arkansas Democrat-Gazette that NDAs have been part of economic development work for decades: "It's a common practice because it protects a company's private information". Critics counter that data centers are different in kind from typical commercial projects because of the scale of their resource demands.
Legislatures are now responding. In at least 10 states this year, lawmakers have proposed either banning economic development NDAs, banning them for data center projects, or limiting the information they can conceal, according to Governing.
In March, Microsoft $MSFT announced it would no longer use NDAs with local governments in developing data centers, according to Wisconsin Public Radio. The company said it would continue using NDAs for private land acquisitions, drawing a distinction between secrecy during deal negotiations and secrecy from the public once a project reaches government review.
The move came after sustained backlash. From May 2024 to March 2025, $64 billion in U.S. data center projects were blocked or delayed due to local opposition, according to Data Center Watch. Bill Lueders, president of the Wisconsin Freedom of Information Council, said Microsoft's decision came "only after their attempts to work with these non-disclosure agreements blew up in their face", as reported by Virginia Business.
Whether other companies follow remains an open question. Meanwhile, the federal transparency picture has moved in the opposite direction. In March 2025, the Financial Crimes Enforcement Network issued an interim final rule removing the requirement for U.S. companies and U.S. persons to report beneficial ownership information under the Corporate Transparency Act, FinCEN said. That law, enacted in 2021, was designed to reduce the anonymity of shell companies. Its effective suspension means the primary federal tool for identifying who stands behind an LLC is no longer operative for domestic entities.
The result is a gap. State legislatures are beginning to demand disclosure for data center projects. But the underlying legal architecture that enables anonymous land acquisition remains intact.
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