Seattle City Council committees approved a one-year moratorium on new large data center permits. The full council scheduled a final vote for June 9. Public opposition influenced the move, with residents sending over 93,000 emails to city leaders. These messages cited concerns regarding power grid strain, water consumption, and environmental impacts.
The ban directly impacts major real estate players including Equinix and Prologis. Four companies proposed five facilities that are now in jeopardy. These projects would have required an estimated 369 MW of power. The legislation highlights growing regulatory pushback against data center expansion.
This development introduces new risks for data center REITs, a sector recently bolstered by the AI boom. Permitting difficulties in key markets like Seattle could temper future growth forecasts. On June 6, Digital Realty shares fell approximately 1%. Equinix shares declined by roughly 0.75% during the same session.