Transparency Gap as Hyperscale Data Plans to More Than Double Its Southwest Michigan Footprint

*DOWAGIAC, MI* — A Las Vegas-based artificial intelligence company has announced plans to more than double its data center operations in Dowagiac, yet city officials say they learned about the expansion from a press release at the same time as everyone else.

Hyperscale Data, Inc. — a subsidiary of Alliance Cloud Services, LLC — has announced an agreement to acquire 48.5 acres of land in southwest Michigan, which would bring the company's total ownership to approximately 83 acres in the area. The company already operates a 30-megawatt data center in Dowagiac at the Business Center of Southwest Michigan.

"This is a significant step in the right direction. This land acquisition will give us additional space and the opportunity for future development and demonstrates the Company's long-term commitment to Southwest Michigan and the Company's operations there," said Will Horne, CEO of Hyperscale Data, in a press release.

The company expects to finalize the transaction within 60 days. The proposed expansion would potentially bring the facility's capacity to 340 megawatts — enough to power 200,000 to 300,000 homes — though the company has not submitted specific floor plans or operational details to Dowagiac city officials.

City Officials Caught in the Dark

Dowagiac City Manager Kevin Anderson confirmed that city leaders were blindsided by the announcement.

"The city learned about this potential real estate transaction at the very same time everybody else did when the company issued a press release that came out yesterday morning sometime," Anderson said. "We haven't had any contact with them about that."

Anderson explained that it would be highly unusual for a business to consult the city when buying or selling property. Normally, property transfers result in filings that generate tax and utility bills, but in this case, the company bypassed the city entirely.

"After somebody closes, forms get filed with the city so that we can send the tax and utility bills to the appropriate place," Anderson explained. "So, it would be very rare that we would hear something like this in advance."

The city had previously engaged with Hyperscale Data when the company announced last summer its intention to scale up from 30 megawatts to 340 megawatts — a massive increase in power demand. At that time, the company promised a 2029 completion date with initial milestones in 2027, but never followed through with formal permitting.

Community Pushback Over Noise

Residents living near the Dowagiac facility have already voiced concerns about the noise levels coming from the data center. Terry Raab, a local resident, told News Channel 3 that the constant noise has made him unable to open his windows during summer months.

The city recently instituted a noise ordinance with specific decibel limits to address these complaints. Dowagiac will now monitor noise levels and enforce the rules if necessary.

"We've been doing a lot of homework," said Dowagiac Mayor Patrick Bakeman during a recent Cass County informational session on data centers. "It was a valuable session, and we thank the Cass County team for organizing it."

Mayor Bakeman released an open letter to Hyperscale Data CEO Will Horne addressing the lack of communication and transparency. The city council recently approved language adding specific decibel level limits to city ordinances, which makes it much easier to enforce violations.

Broader Implications for Michigan Communities

Cass County recently hosted an informational session featuring Dr. Sarah Mills, director of the Center for Empowering Communities at the University of Michigan, who specializes in energy policy and land use planning in rural communities.

According to Dr. Mills, Michigan currently has anywhere between 10 and 70 data centers, depending on how you define the term. The surge in interest comes as companies like Microsoft and Meta scramble to build infrastructure for generative AI.

"That has led to needing even more computers packed closer together and what that means is those facilities have both bigger land usage, but also bigger needs for electricity," Dr. Mills said.

Dr. Mills noted that data center developers look for specific factors when choosing locations: cleared land, proximity to power sources, low millage rates or property taxes, and favorable zoning. She estimated that larger data centers can use millions of gallons of water per day and consume more than one gigawatt of energy per day.

The Cass County session served as an educational opportunity for municipal leaders to understand how to create policy frameworks — including options to limit or prohibit development if communities choose.

Dowagiac's Proactive Approach

Mayor Bakeman attended the Cass County session alongside his city manager's office and the majority of the city council. He noted that many of the recommendations from experts align with steps Dowagiac has already taken.

"We've been doing a lot of homework," Bakeman said. "We will continue educating ourselves and doing what's right for the entire community."

The city is now waiting for Hyperscale Data to reach out with formal expansion plans. Once the company submits plans, Dowagiac will review them and can evaluate whether the project aligns with community interests and quality of life concerns.

What's Next

Hyperscale Data has not yet finalized the land purchase in southwest Michigan, and the company did not immediately respond to requests for comment beyond the press release statements.

Dowagiac continues to prepare for potential data center development by bringing in outside experts and establishing noise regulations. The city council has expressed commitment to ensuring that any development benefits the neighborhood without coming at the expense of nearby residents.

As the company's 60-day timeline for closing approaches, Dowagiac and Cass County remain vigilant in monitoring the situation and protecting the interests of their communities.

Sources:

  • "'Nothing but a noise trap': Dowagiac residents push back against AI data center expansion" – WWMT – https://wwmt.com/news/local/ai-data-center-expansion-dowagiac-loud-noise-complaints-residents-southwest-michigan-hyperscale-megawatt-bitcoin-wwmt
  • "AI tech company seeks to acquire 48.5 acres in southwest Michigan for expansion" – WNDU – https://www.wndu.com/2026/03/31/ai-tech-company-seeks-acquire-485-acres-southwest-michigan-expansion/
  • "Cass County hosts informational session on data centers" – The Herald Palladium – https://www.paxtonmedia.com/news/the_herald_palladium/cass-county-hosts-informational-session-on-data-centers/article_a59044d4-1e1c-5fed-bebe-fe772b40847b.html
  • "A Las Vegas company says it will expand Michigan data center. Locals are in the dark" – MLive – https://www.mlive.com/news/2026/04/a-las-vegas-company-says-it-will-expand-michigan-data-center-locals-are-in-the-dark.html