A San Francisco-based real estate giant wants to knock down five aging industrial and commercial buildings in North San Jose and replace them with a three-story, 514,000-square-foot data center capable of drawing 99 megawatts of power. The proposal from Prologis, filed as a special use permit with the city of San Jose, targets a site at the corner of Charcot Avenue and Zanker Road, at 326 Charcot Ave., in a neighborhood already dense with tech infrastructure.
The project, first reported by The Mercury News, would rise in a stretch of North San Jose that already hosts Google, Cisco and Apple, according to the report. The planned facility would feature a modern facade with curtained walls, and Prologis has proposed including a backup generator in a dedicated yard along with an onsite substation, the newspaper notes.
It is the second major data center Prologis has floated in San Jose this year. The company previously proposed a 516,000-square-foot, 99-megawatt data center covering 15 acres of empty land at 5977 Silver Creek Valley Road in South San Jose, a project Hoodline detailed in July. That South San Jose site sits roughly 2.5 miles from a PG&E substation on Santa Teresa Boulevard that the utility recently upgraded to 80 megawatts of capacity, with room for further expansion, according to a July 2026 report from Industry Insider.
Why 99 Megawatts, Not 100
The North San Jose facility's capped power draw is no accident. Facilities that reach or exceed 100 megawatts trigger mandatory licensing oversight from the California Energy Commission, while projects under that threshold are governed primarily by local municipal land-use permits, according to KQED. Multiple major data center proposals across San Jose, including both of Prologis's projects, have landed at exactly 99 megawatts as a result.
San Jose is currently fielding requests for at least 11 data center developments totaling more than 1,600 megawatts of proposed power, KQED reports. The cluster includes a 444,436-square-foot facility from Menlo Equities on Charlotte Drive and a 152,676-square-foot project from Oppidan on Embedded Way, according to The Real Deal, positioning the city as one of California's most power-ready markets for artificial intelligence computing.
Grid Costs Fall on Prologis, Company Says
Prologis has committed to funding all costs to connect the North San Jose data center to the electricity grid, including required PG&E substation upgrades, per the Mercury News report. The company also plans to include a second independently routed transmission line, intended to reduce reliance on backup generation and enhance system reliability. PG&E, according to Prologis, plans to expand its nearby substation capacity beyond what the data center itself requires, and the utility has separately launched efforts to broadly expand its substation facilities across San Jose.
Those pledges arrive against a backdrop of ballooning utility demand. PG&E's proposed data center interconnection pipeline reached 12.71 gigawatts across 26 projects at the end of June 2026, up from 5.09 gigawatts in March, according to Utility Dive. Only 490 megawatts of that pipeline currently have signed interconnection construction agreements, the outlet reports, and utility executives have argued that each additional gigawatt of connected data center load could lower customer electricity bills by 1% or more under proper tariff design.
Ratepayer Protections and Community Benefits
California lawmakers have already moved to guard against the risk that rapid data center growth shifts infrastructure costs onto ordinary customers. The state enacted Senate Bill 57 in October 2025 to study exactly that question, and the California Public Utilities Commission opened a rulemaking in April 2026 to structure large-load tariffs and require developers to fund transmission upgrades upfront, according to the American Bar Association.
San Jose has taken its own steps. City officials began drafting uniform municipal standards for data centers in June 2026, and a City Council committee voted in August to direct staff to require developers to fund community benefits such as public parks, affordable housing and residential solar programs, KQED reports. Data centers broadly continue to face concerns over environmental impacts, water use and electricity bills even as the tech industry views the facilities as crucial to building enough computing power for artificial intelligence.
Prologis has set a goal of powering its facilities with 100% carbon-free electricity and intends to enroll the North San Jose project in San Jose's TotalGreen program or a similar offering, according to the Mercury News. San José Clean Energy's TotalGreen program lets commercial and residential customers receive fully renewable wind and solar power for an added premium of one cent per kilowatt-hour over standard rates, according to San José Clean Energy, which serves more than 98% of San Jose's power customers as a Community Choice Aggregator.
Part of a Bigger Wave
The North San Jose proposal lands amid a broader corporate pivot toward data centers. Prologis has expanded its global data center power pipeline to 5.8 gigawatts, with 1.6 gigawatts already secured, and published eight responsible development commitments meant to address concerns over grid cost shifts, water usage and backup power emissions, according to GlobeSt. The company manages roughly $240 billion in real estate assets and has been converting traditional industrial sites into power-dense digital infrastructure nationwide.
Community pushback has now joined power availability as a primary constraint on data center development nationally, according to an August 2026 analysis from CBRE, even as CoStar research projects 219 new data centers totaling 76.1 million square feet will open across the U.S. this year, up sharply from 125 facilities completed in 2025. Data centers have already encountered growing opposition in some Bay Area cities and around the country, a dynamic playing out just miles away, where neighbors have criticized Google's proposed 250-megawatt facility and substation, as Hoodline reported in July.
North San Jose's build-out follows Microsoft's groundbreaking in June on a two-building, 396,914-square-foot data center campus in the Alviso district, also capped at 99 megawatts and designed with recycled water cooling and renewable natural gas backup generators. The North San Jose special use permit filing for the Charcot Avenue site remains under city review, with no public hearing date yet announced in available reporting.
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