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Residents of one California town cause developer to withdraw local data center proposal

Developer Eight Form withdrew a proposal to build a 240,000-square-foot data center in El Segundo after strong community opposition at a planning commission meeting. Residents cited concerns over power use, noise, and pollution, and argued that the project's environmental review was outdated. The withdrawal occurred before the commission could vote on the plan.

read6 min views1 publishedJul 16, 2026
Residents of one California town cause developer to withdraw local data center proposal
Image: Mercurynews (auto-discovered)

Getting your

Trinity Audioplayer ready...A developer recently withdrew a proposal to build a massive data center in El Segundo after hearing droves of residents oppose the project.

It happened after the first reading of the plan during a public hearing at the El Segundo Planning Commission’s meeting last week. The community’s opposition stopped the process before it even reached the point of a commission vote.

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The real estate development firm Eight Form applied to demolish the existing Hyatt Place hotel, 750 N. Nash St., and build a five-story, nearly 240,000 square-foot data center in its place.

The data center would have housed computer servers supporting equipment for private clients, such as web hosting, network storage and application processing, according to the project proposal. It would have reached up to 169 feet in the sky, and be accompanied by a high-voltage electrical substation to power the center.

But community concerns over excessive power use, noise, pollution and other issues led Eight Form founder Arjun Shokeen to withdraw the proposal.

Nearly 60 people were set to make public comments on the issue at the recent planning commission meeting. Most of them did, and when there were 15 left in line to speak, Shokeen announced from the audience that he would withdraw the application.

“I’ve heard the community loud and clear,” Shokeen said. “They’ve made their voice very present, and my intention isn’t to put anybody through any mental or physical harm. We’re going to be withdrawing the application; we’re not going to be moving forward with the data center.”

The data center would have been part of the city’s Corporate Campus Specifc Plan, a larger development project that has been in the works since 2002, city staff said. The entire campus is a 46.5-acre space with mixed-use businesses between Nash and Douglas streets, near the Metro C Line.

An environmental impact report was conducted for the plan when it was first developed, and an addendum would have been included in that report for the proposed data center to proceed.

Residents, however, said that a 24-year-old analysis is not sufficient for a project of this magnitude today, and an entirely new EIR should be conducted.

Data centers were not part of the 2002 Corporate Campus Specific Plan, resident Alex Perez said.

“The corporate campus project proposed (almost) 25 years ago is effectively antiquated and lacks any relevance to the proposed data center today,” Perez said during the Thursday, July 9, commission meeting. “The report was based on various uses, none of which included a data center.”

The EIR was written for a completely different development, he added, and the proposal asked to build nearly four times the size of what the 2002 report originally intended. Water use, energy demand and heat generation have changed dramatically since the beginning of the new millenium.

The corporate campus plan anticipated 2.5 million square feet of mixed-use development, according to a staff report, including office space and other land uses. There’s currently the Los Angeles Lakers UCLA Health Training Center, Hyatt Place Hotel, restaurants and more.

But only about half of that 2.5 million square feet has been built out so far, staffers said.

At the data center, power would have run constantly, 24 hours per day, seven days a week, 365 days a year at the data center, with 16 generators on standby to crank on in case of emergencies, the staff report said. The diesel-run generators would have been tested monthly or so.

Extra overhead space was going to be dedicated on each data hall floor to ventilate heat produced by the computer servers.

But even with pulling continuous energy to power those machines, staff said, it would’ve had less impact on the grid than the Hyatt currently does. Most of the energy used would have been for the servers and cooling systems, the staff report said, and lighting and water would be used minimally, only in places where humans would be, such as offices and lobby areas.

“I find the comparisons of this data center to the hotel rather frustrating, as this is an entirely different kind of project,” resident Kai Albertson said. “People need water and electricity, they need utilities; the data center, as we’ve had it described, is a box with windows and a lot of environmental concerns.”

Rita Garcia, the city’s environmental consultant from firm Kimley Horn, said the data center would consume 8,900 fewer gallons of water per day than the hotel currently uses.

HVAC cooling systems would have been on the rooftop, with nearly 30 air-cooled chillers operating via a closed-loop chilled water ring. It’d take in water once and recirculate it continuously, while most similar facilities constantly consume new water.

“Not all data centers are created equally,” Garcia said.

The center also would’ve been much quieter than similar facilities since the generators would have been enclosed, she added, but consultants had not actually found a data center with the comparative operating conditions and design parameters that were supposed to make this one better.

Planning Commission Chair Kevin Maggay, for his part, said that rather than theorizing the potential impacts, environmental consultants should have taken noise readings at existing data centers to give a true look at what could have come to the city.

It was not clear what exactly would have been computed in the center, but the developer said El Segundo was the right place for it because of the city’s aerospace and manufacturing industries.

Shokeen himself gave a presentation at the meeting and said that after the center would have been built, an operator would need to be found that would commit to a lease that would support a $600 million build-out. There was no guaranteed operator for the building.

Clients would either use the data center as a place to relocate their existing server,s or as a place to operate new servers and expand their server capacity, according to the proposal.

Some in the audience seemed perplexed by the uncertainty of the plan for the center.

Resident Danielle Busse, for example, said she was “shocked and less confident in their ability to pull it off” after hearing from the developer at the meeting.

Busse added that she had concerns about the water being recycled and breeding bacteria, as well as whether residents or data centers would be prioritized in the event of electrical drain during heatwaves, as she has heard that in other communities with those facilities, residents are told to find their own energy sources.

Residents also said that the proximity of the location to the Wiseburn School District and youth athletic fields would be hazardous to children.

The defeat of the data center is a “reminder that when residents show up, stay informed, and participate, they can meaningfully influence the direction of their local government,” according to a statement this week from local community activist group Sea Change.

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