PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT
MEMORANDUM
TO: Douglas Fairchild, Esq. (Calderwood & Harkness LLP) Leonard Castellano (EVP, Development, Ironhaven Data Centers LLC)
FROM: Cynthia Ho (Calderwood & Harkness LLP)
DATE: March 25, 2025
RE: Loudoun County Zoning Modification Application (ZMOD) — Process, Timeline, and Strategy for Stonebridge Data Center Campus
Matter No.: 1043-00002
Right-click to update Table of Contents
I. Purpose and Summary
This memorandum outlines the procedural requirements, expected timeline, required submissions, and strategic considerations for obtaining a Zoning Modification Application ("ZMOD") approval from Loudoun County, Virginia, to permit data center use on the approximately 81.4-acre Stonebridge Data Center Campus site (the "Stonebridge Campus" or the "Site"). This memorandum is intended to provide a comprehensive overview for use by the Calderwood & Harkness LLP ("C&H") deal team and the Ironhaven Data Centers LLC ("IHDC") development team in coordinating the ZMOD process with the broader development, financing, and construction timeline for the Stonebridge Campus project.
The Stonebridge Campus consists of two contiguous parcels located in unincorporated Loudoun County, Virginia:
(a) The Stonebridge Parcel, comprising approximately 62.0 acres (Loudoun County Tax Map Ref. /95-4A-1///), to be acquired by IHDC from Blackthorn Realty Group, Inc. ("Blackthorn") pursuant to a Purchase and Sale Agreement currently under negotiation (the "Stonebridge PSA"); and
(b) The Meridian Parcel, comprising approximately 19.4 acres (Loudoun County Tax Map Ref. /95-4A-2///), to be acquired by IHDC from Meridian Acres LLC ("Meridian") pursuant to a separate Purchase and Sale Agreement also under negotiation (the "Meridian PSA").
Both parcels are located at the intersection of Belmont Ridge Road (Virginia Route 659) and Stonebridge Boulevard, in unincorporated Loudoun County, Virginia 20148. The parcels are situated within the Dulles subarea of the County's Suburban Policy Area, in a corridor with significant existing data center development.
The project contemplates the development of a ground-up data center campus with an estimated total project cost of approximately $600,000,000. As currently conceived, the Stonebridge Campus will comprise four data center buildings (designated Buildings A through D), each approximately 120,000 square feet in gross floor area and designed to support approximately 24 megawatts ("MW") of critical IT load, together with a central utility plant ("CUP"), emergency generator compounds, electrical switchgear yards, and associated site infrastructure including roadways, parking, stormwater management facilities, and perimeter security. At full build-out, the campus will deliver a total critical IT load capacity of approximately 96 MW and a total gross floor area of approximately 480,000 square feet.
IHDC, a Delaware limited liability company headquartered at 44680 Prentice Drive, Suite 200, Ashburn, Virginia 20147, is the project developer and will serve as the ZMOD applicant. Leonard Castellano, Executive Vice President of Development, is the primary project contact within IHDC.
The target timeline for the ZMOD process is as follows: ZMOD application filing by May 30, 2025, with a target date for the Board of Supervisors public hearing and approval in October 2025. Based on preliminary discussions with local zoning counsel, the expected ZMOD application docket number upon acceptance is ZMOD-2025-0038.
IHDC has engaged the following firms to support the ZMOD process and application preparation:
• Local Zoning Counsel: Ashcroft & Wynn, P.C. ("A&W"), with Thomas Ashcroft serving as lead attorney, located at 25 West Market Street, Leesburg, Virginia 20176. A&W has extensive experience representing data center developers before the Loudoun County Board of Supervisors and Department of Planning and Zoning ("DPZ").
• Land Use Consultant: Cornerstone Land Use Consulting, LLC ("Cornerstone"), with Alan Mercer serving as the principal consultant, located at 19 Cornwall Street NW, Suite 210, Leesburg, Virginia 20176. Cornerstone will prepare the ZMOD application narrative, statement of justification, and fiscal impact materials, and will lead community engagement efforts.
This memorandum should be read in conjunction with the project overview materials previously circulated and the forthcoming memoranda on proffer negotiation strategy and conditional zoning approval risk analysis, each of which is referenced herein.
II. Existing Zoning and Proposed Change
A. Current Zoning Classification
Both the Stonebridge Parcel and the Meridian Parcel are currently zoned PD-IP (Planned Development – Industrial Park) under the Loudoun County Revised 1993 Zoning Ordinance, as amended ("Zoning Ordinance"). The PD-IP zoning district is designed to accommodate a range of industrial, office, warehouse, distribution, and flex-use developments within a planned development framework, subject to the specific conditions and proffers established at the time the PD-IP zoning was originally approved by the Board of Supervisors.
Under the current PD-IP zoning conditions applicable to the Stonebridge Parcel and the Meridian Parcel, permissible uses include general office, research and development, light industrial, warehousing and distribution, and flex-space uses, among others. However, the existing PD-IP conditions do not expressly authorize data center use on either parcel. While data center facilities share certain physical characteristics with warehouse and industrial buildings (large, single-story structures with significant mechanical and electrical infrastructure), the use classification, operational characteristics, and community impact profile of a data center are sufficiently distinct that Loudoun County has consistently required a zoning modification to authorize data center use on parcels zoned PD-IP or other planned development districts that do not specifically enumerate data centers as a permitted use.
This approach is consistent with Loudoun County's evolving regulatory framework for data center development. As the preeminent data center market in the Commonwealth of Virginia — and one of the largest in the world — Loudoun County has developed a substantial body of practice regarding the entitlement of data center facilities through the ZMOD process. The County has approved numerous ZMODs for data center projects in the Dulles and surrounding corridors over the past decade, and County staff are well-versed in the technical, fiscal, and community impact considerations associated with data center development.
B. Nature of the Zoning Modification
The ZMOD application that IHDC will submit to the Loudoun County DPZ will seek to modify the existing PD-IP zoning conditions applicable to both the Stonebridge Parcel (Tax Map Ref. /95-4A-1///) and the Meridian Parcel (Tax Map Ref. /95-4A-2///) to expressly permit data center use on the combined 81.4-acre campus site as part of a unified development plan. It is important to note that the ZMOD is not a full rezoning of the parcels from one zoning district to another. Rather, it is a legislative amendment to the specific development conditions and proffers associated with the existing PD-IP zoning to accommodate the proposed data center campus use, including the specific building massing, site layout, utility infrastructure requirements, noise-generating equipment, and other development parameters unique to a data center facility.
The ZMOD application will be filed as a single, unified application covering both parcels. This approach is preferred because the Stonebridge Campus is planned as an integrated development with shared infrastructure, access, and utilities crossing the parcel boundary between the Stonebridge Parcel and the Meridian Parcel. Filing a single ZMOD application also streamlines the review process, avoids duplicative submissions, and presents the project to County staff and decision-makers as a cohesive development concept rather than two independent applications.
The ZMOD will establish, among other things, the following parameters for the Stonebridge Campus development:
• Authorization of "data center" as a permitted use on both parcels;
• Maximum building height, setbacks, and building coverage ratios appropriate for data center structures;
• Provisions for emergency generators and associated fuel storage;
• Noise attenuation standards and operational noise limits at property boundaries;
• Landscape screening, buffering, and architectural treatment requirements;
• Access and circulation plans, including connections to Belmont Ridge Road and Stonebridge Boulevard;
• Utility infrastructure provisions, including provisions for the electrical substation to be located on the Meridian Parcel; and
• Proffer commitments addressing fiscal, transportation, environmental, and community impacts.
C. Loudoun County Comprehensive Plan Consistency
A critical component of the ZMOD application will be a demonstration that the proposed data center use is consistent with the Loudoun County 2019 General Plan (the "Comprehensive Plan"), as amended. The Comprehensive Plan establishes land use policies and guidelines for various planning areas within the County, and consistency with the Comprehensive Plan is a significant factor in the County's evaluation of any ZMOD application.
The Stonebridge Campus is located within the Suburban Policy Area as designated by the Comprehensive Plan. The Suburban Policy Area encompasses much of the eastern portion of Loudoun County and is the area where the County has directed the majority of its commercial, industrial, and higher-density residential development. Within the Suburban Policy Area, the Comprehensive Plan designates certain areas for industrial and employment uses, and the parcels in question fall within an area that is generally planned for employment and industrial uses consistent with the existing PD-IP zoning.
The Comprehensive Plan expressly acknowledges the importance of data center development to Loudoun County's economic base and fiscal health. Data centers are among the largest contributors to the County's commercial tax base, generating significant real property and business personal property (BPOL) tax revenues while imposing relatively modest demands on County services such as schools, public safety, and transportation (compared to residential or mixed-use development). The Comprehensive Plan includes policies supporting the continued growth of the digital infrastructure sector, particularly within designated industrial and employment areas in the Suburban Policy Area.
The ZMOD application narrative prepared by Cornerstone will include a detailed analysis of Comprehensive Plan consistency, highlighting the following points:
• The Site's location within an established employment corridor with existing data center, industrial, and office development;
• The compatibility of data center use with surrounding land uses and the PD-IP zoning framework;
• The positive fiscal impact of the proposed development, including projected tax revenues and the minimal demand on County services;
• The project's consistency with the County's policy of supporting high-quality digital infrastructure investment; and
• The applicant's commitment to addressing community impact concerns through comprehensive proffers, including landscaping, noise mitigation, and transportation improvements.
We note that while the Comprehensive Plan is an important analytical framework, consistency with the Comprehensive Plan is not a legal prerequisite to ZMOD approval under Virginia law. The Board of Supervisors retains legislative discretion in acting on ZMOD applications. However, as a practical matter, demonstrating Comprehensive Plan consistency strengthens the application and reduces the likelihood of staff opposition or Board reluctance to approve the modification.
III. ZMOD Application Process — Step-by-Step Overview
The following sections describe each stage of the ZMOD application process as it applies to the Stonebridge Campus project, from the pre-application conference through post-approval steps.
A. Pre-Application Conference
The Loudoun County Department of Planning and Zoning requires, or at minimum strongly encourages, a pre-application conference ("PAC") before the formal submission of a ZMOD application. The PAC is an informal meeting between the applicant's team and County staff designed to introduce the project concept, identify potential issues or concerns at an early stage, confirm the applicable submission requirements, and discuss the anticipated review timeline.
Calderwood & Harkness LLP and Ashcroft & Wynn, P.C. are currently preparing a joint letter to the Loudoun County DPZ requesting a pre-application conference. The target for sending this letter is the first week of April 2025, with the goal of scheduling the PAC for late April or early May 2025. This timeline will allow the project team to incorporate any feedback or direction received from County staff into the application materials being prepared for the May 30, 2025 filing.
The PAC will be attended by representatives of IHDC (Leonard Castellano and Diane Prescott of Kestrel Infrastructure Advisors, LLC), local zoning counsel (Thomas Ashcroft of A&W), the land use consultant (Alan Mercer of Cornerstone), the civil/site engineer (Carlos Esteban, PE, of Lumen Ridge Engineering, PLLC), and, as appropriate, representatives of C&H. The PAC is not a public hearing, and no formal action is taken by County staff at this stage. However, the PAC provides valuable insight into staff expectations, particularly with respect to the scope and content of the ZMOD application materials, the level of proffer commitment that County staff will expect, and any specific technical concerns (e.g., traffic, noise, stormwater) that the application will need to address.
Based on A&W's recent experience with other data center ZMOD applications in Loudoun County, we anticipate that County staff will be particularly focused on the following topics at the PAC:
• The proposed scale and phasing of the data center campus;
• Building height and massing, including the height of associated structures such as generators, cooling towers, and the electrical substation;
• Noise generation from mechanical equipment and emergency generators, and proposed noise attenuation measures;
• Visual impact and landscape screening, particularly along Belmont Ridge Road and for any adjacent residential or mixed-use properties;
• Traffic generation during construction and at full build-out;
• Water consumption for cooling systems;
• Stormwater management for the large impervious area associated with data center buildings and paved areas; and
• The proposed proffer framework and community benefit commitments.
B. Application Preparation and Filing
Filing Target: May 30, 2025.
The ZMOD application will be prepared under the direction of Ashcroft & Wynn, P.C. and Cornerstone Land Use Consulting, LLC, with engineering and environmental support from the project's technical consultants and legal review and coordination by C&H. The application package must be comprehensive, professionally prepared, and responsive to the issues identified at the pre-application conference. An incomplete or poorly prepared application can result in significant delays during the completeness review stage and can undermine the applicant's credibility with County staff and decision-makers.
The following materials will be required for inclusion in the ZMOD application package:
1. Completed ZMOD Application Form. The standard application form prescribed by the Loudoun County DPZ, executed by the applicant and including contact information for the applicant, the record property owners, and the applicant's authorized agents and consultants.
2. ZMOD Application Narrative and Statement of Justification. A detailed written narrative describing the proposed data center campus use, the nature and scope of the requested zoning modification, the basis for the modification, consistency with the Loudoun County Comprehensive Plan, compatibility with surrounding land uses, and the community benefits associated with the project. This document will be the primary advocacy piece in the application package and will be prepared by Cornerstone in close coordination with A&W and C&H.
3. Conceptual Development Plan / Generalized Development Plan ("GDP"). A graphic plan showing the proposed building locations, campus layout, vehicular and pedestrian access points, internal circulation, setbacks and buffer yards, utility infrastructure corridors, the location of the proposed electrical substation on the Meridian Parcel, emergency generator locations, cooling equipment areas, stormwater management facilities, and the relationship of the development to surrounding properties and roadways. The GDP will be prepared by Lumen Ridge Engineering, PLLC, under the direction of Carlos Esteban, PE, as the project's civil/site engineer. The GDP is not a final engineering plan but rather a conceptual illustration of the development at a level of detail sufficient to permit County staff and decision-makers to evaluate the proposal.
4. Traffic Impact Analysis ("TIA"). A traffic study evaluating the traffic generation, distribution, and impact of the proposed data center campus on the surrounding road network, including Belmont Ridge Road, Stonebridge Boulevard, and other affected intersections. The TIA will be prepared by a licensed traffic engineering firm and will include projected trip generation rates, level-of-service analyses for key intersections, and recommended transportation improvements or mitigation measures. Data centers typically generate relatively low traffic volumes compared to office or retail uses of similar size, and the TIA should reflect this characteristic. The TIA must comply with the requirements of both Loudoun County DTCI and the Virginia Department of Transportation ("VDOT").
5. Fiscal Impact Analysis. An analysis of the projected fiscal impact of the proposed data center campus on Loudoun County, including estimated tax revenue generation (real property tax, business personal property tax, and other applicable taxes) and estimated demand on County services (schools, public safety, transportation, parks, and other services). Data center projects typically demonstrate a strongly positive fiscal impact for Loudoun County, generating substantial tax revenues with minimal service demands, and this analysis will be a key component of the justification for the ZMOD.
6. Noise Study. An acoustical analysis evaluating the noise generated by the data center's mechanical systems (HVAC cooling equipment, air handling units) and emergency diesel generators during normal operations and emergency/testing conditions. The noise study will model sound levels at the property boundaries and at the nearest noise-sensitive receptors, and will identify noise mitigation measures necessary to comply with applicable Loudoun County noise standards. This is a critical issue for data center ZMODs in Loudoun County, as noise from data center operations has been a frequent subject of community concern and Board scrutiny.
7. Visual/Landscape Screening Plan. A conceptual landscape and screening plan showing proposed vegetative buffers, berms, fencing, and architectural treatments designed to minimize the visual impact of the data center buildings and associated equipment (generators, cooling towers, transformers, switchgear) on surrounding properties and public roadways. The plan should address views from Belmont Ridge Road, Stonebridge Boulevard, and adjacent parcels, and should specify the types, sizes, and densities of proposed landscape plantings.
8. Environmental and Stormwater Management Overview. A summary of the environmental conditions on the Site (drawing on the Phase I and Phase II Environmental Site Assessments prepared by Pendleton Environmental Associates, Inc.) and a conceptual stormwater management plan addressing the management of stormwater runoff from the approximately 480,000 square feet of building footprint and associated impervious surfaces. The stormwater plan must comply with the Virginia Stormwater Management Program ("VSMP") regulations and Loudoun County's local stormwater management ordinance.
9. Draft Proffer Statement. A preliminary proffer statement setting forth the voluntary commitments being offered by the applicant to address community impacts associated with the proposed development. The proffer statement will be drafted by C&H in coordination with A&W and Cornerstone, and will be subject to revision during the staff review and negotiation process. The content and estimated amounts of the proffer statement are discussed in Section IV of this memorandum.
10. Title Documentation and Owner Authorization. Because IHDC will not yet have closed on the acquisition of either the Stonebridge Parcel or the Meridian Parcel at the time the ZMOD application is filed, the application must be accompanied by authorization letters from the current record owners — Blackthorn Realty Group, Inc. (with respect to the Stonebridge Parcel) and Meridian Acres LLC (with respect to the Meridian Parcel) — expressly authorizing IHDC to file the ZMOD application on their behalf. These letters must be duly executed by the authorized representatives of the respective entities. In addition, title documentation (copies of recorded deeds and plats) confirming the ownership of each parcel will be required. The mechanics of obtaining these authorization letters are discussed in Section VI.A below.
11. Application Fees. The ZMOD application fee prescribed by the current Loudoun County fee schedule must accompany the application submission. A&W will confirm the applicable fee amount prior to filing.
The preparation of these materials requires coordination among multiple consultants and firms, and the May 30, 2025 filing deadline leaves limited margin for delay. The traffic impact analysis and noise study, in particular, require lead time for data collection, modeling, and report preparation, and should be commissioned no later than the first week of April 2025.
C. Completeness Review and Referral
Upon submission of the ZMOD application package, the Loudoun County DPZ will conduct an initial completeness review to determine whether the application contains all required materials in a form sufficient for substantive review. This completeness review typically requires two to four weeks following submission. Based on our May 30, 2025 filing target, we anticipate the completeness review will occur during June 2025.
If DPZ staff determine that the application is incomplete — for example, if a required study is missing, if application forms are not properly executed, or if the GDP does not include sufficient detail — staff will issue a written deficiency notice identifying the missing or deficient items. Upon issuance of a deficiency notice, the review clock effectively pauses until the applicant provides the supplemental or corrected materials. This is a common source of delay in the ZMOD process, which underscores the importance of submitting a thoroughly prepared and complete application package at the outset.
Upon acceptance of the application as complete, DPZ will assign a formal docket number. Based on the current pace of ZMOD filings in Loudoun County, we expect the application to be assigned docket number ZMOD-2025-0038, although the actual number will be determined by DPZ at the time of acceptance. We anticipate docket number assignment in late June 2025.
Following acceptance and docket number assignment, DPZ will refer the application to various County departments and external referral agencies for technical review and comment. The referral agencies typically include:
• Department of Planning and Zoning (DPZ) — Lead review agency; staff analysis of the application, consistency with the Comprehensive Plan, and preparation of the staff report;
• Department of Transportation and Capital Infrastructure (DTCI) — Review of the traffic impact analysis, transportation improvements, road access, and impact on the County's Capital Improvement Program;
• Department of Building and Development — Review for compliance with building codes, fire codes, and development standards;
• Fire marshal's Office — Review of fire access, life safety systems, emergency generator fuel storage, and fire suppression requirements;
• Health Department — Review of any public health considerations, including water and sewer service availability;
• Virginia Department of Transportation (VDOT) — Review of entrance and access points on state-maintained roads (Belmont Ridge Road is a VDOT-maintained facility), traffic impact on state roads, and any required road improvements;
• Loudoun County School Board — Review of fiscal impact on the school system (typically minimal for data center uses, which do not generate residential students);
• Loudoun Water — Review of water and sewer service availability and capacity; and
• Other referral agencies as applicable, which may include the Loudoun County Department of Parks and Recreation, the Metropolitan Washington Airports Authority (given proximity to Dulles International Airport and potential airspace considerations for any tall structures such as cooling towers or generator stacks), and utility providers.
D. Staff Review and Comment Period
The agency referral and review period typically extends 60 to 90 days following acceptance of the application. Based on our projected late June 2025 acceptance, the referral review period would span approximately July through August 2025, with staff report preparation occurring in August through September 2025.
During the review period, each referral agency will evaluate the application within its area of expertise and provide written comments and recommendations to DPZ. These comments may include requests for additional information, identification of technical deficiencies, and recommended conditions of approval. DPZ staff will compile the referral comments and prepare a comprehensive staff report analyzing the application, summarizing the referral agency comments, and setting forth staff's recommendation regarding the ZMOD — typically a recommendation of approval with conditions, approval with modifications, or denial.
It is critically important that IHDC's team — led by Cornerstone (Alan Mercer) and A&W (Thomas Ashcroft) — engage in proactive, iterative discussions with County staff throughout the review period. This engagement serves several purposes: it allows the applicant to understand and respond to staff concerns before they are memorialized in the staff report; it provides an opportunity to negotiate the terms of recommended conditions and proffer expectations; and it demonstrates a cooperative, good-faith approach that can influence staff's ultimate recommendation. A&W's established relationships with Loudoun County DPZ staff and Board members are a significant asset in this regard.
The applicant's team should be prepared to participate in one or more work sessions with County staff during this period to review technical studies, discuss proffer commitments, and resolve outstanding issues. These work sessions are informal and not public hearings, but they are a critical component of the ZMOD process in Loudoun County.
E. Planning Commission Public Hearing
Following the completion of the staff review period and the issuance of the staff report, the ZMOD application will be scheduled for a public hearing before the Loudoun County Planning Commission. The Planning Commission is an advisory body that reviews land use applications and makes recommendations to the Board of Supervisors.
Based on our projected timeline — a May 30, 2025 filing, completeness acceptance by late June or early July 2025, and agency review through August and September 2025 — we estimate the Planning Commission public hearing will be scheduled for September 2025. The precise date will be determined by the Planning Commission's hearing schedule and the readiness of the staff report.
At the public hearing, the applicant's team will present the ZMOD application, the proposed development plan, and the proffer statement. County staff will present their analysis and recommendation. Members of the public will be afforded the opportunity to testify in support of or in opposition to the application. The Planning Commission will deliberate and issue a recommendation to the Board of Supervisors, which may take one of the following forms:
• Recommendation of approval;
• Recommendation of approval with modifications or additional conditions;
• Recommendation of denial; or
• Deferral of action to a subsequent hearing date (if additional information or analysis is needed).
The Planning Commission's recommendation is advisory only and is not binding on the Board of Supervisors. However, the recommendation carries significant practical weight, and a favorable recommendation from the Planning Commission facilitates Board approval.
Public notice requirements for the Planning Commission hearing are prescribed by the Loudoun County Zoning Ordinance and Virginia Code § 15.2-2204, and include:
• Published notice in a newspaper of general circulation in Loudoun County, at least five days and no more than 21 days before the hearing;
• Posted notice on the property, in a conspicuous location visible from a public road, at least five days before the hearing; and
• Mailed notice to the owners of all abutting properties and properties across the street, at least five days before the hearing.
Compliance with these notice requirements is the responsibility of the County (for published and mailed notice) and the applicant (for posted notice on the property). A&W and Cornerstone will coordinate with DPZ to ensure that all notice requirements are met. Failure to comply with notice requirements can result in a challenge to the validity of any subsequent Board action.
F. Board of Supervisors Public Hearing and Action
Following the Planning Commission's recommendation, the ZMOD application will be scheduled for a public hearing before the Loudoun County Board of Supervisors. The Board of Supervisors is the legislative body with final authority to approve, deny, or defer ZMOD applications.
Our target date for the Board of Supervisors public hearing and action on the Stonebridge Campus ZMOD is October 2025. This target assumes that the Planning Commission hearing occurs in September 2025 and that the Commission does not defer action or request additional analysis that would delay the Board hearing.
At the Board hearing, the process is similar to the Planning Commission hearing: the applicant presents the application, staff presents the staff report and recommendation, and the public is afforded the opportunity to testify. The Board may:
• Approve the ZMOD application, subject to conditions and acceptance of the proffer statement;
• Deny the ZMOD application;
• Defer action to a subsequent hearing date, which may be necessitated by a desire for additional information, unresolved proffer negotiations, significant community opposition, or other factors; or
• Approve with modifications, requiring changes to the development plan, conditions, or proffer statement as a condition of approval.
If the Board approves the ZMOD, the approval constitutes final legislative action. The ZMOD becomes effective upon adoption of the ordinance amendment by the Board, which typically occurs at the same meeting at which the ZMOD is approved or at the next regularly scheduled Board meeting. The proffer statement, as accepted by the Board, is recorded in the Loudoun County land records and runs with the land, binding the current and all future owners of the parcels.
The Stonebridge Campus is located within the Dulles District of the Loudoun County Board of Supervisors. The Dulles District Supervisor's position on the application will be particularly influential, as the Board typically defers to the district supervisor on land use matters within his or her district. A&W and Cornerstone should arrange briefings and outreach with the Dulles District Supervisor and his or her staff well in advance of the Board hearing.
G. Post-Approval Steps
Following ZMOD approval by the Board of Supervisors, IHDC must proceed with site plan submission and approval, which is a separate administrative process conducted by the Loudoun County Department of Building and Development. The site plan is a detailed engineering plan for the physical development of the campus and is distinct from the GDP submitted with the ZMOD application.
Site plan approval requires the submission and review of, among other things:
• Detailed civil engineering plans (grading, utilities, roadways, and site layout);
• Detailed stormwater management plans, including facility design and maintenance plans;
• Detailed landscaping plans demonstrating compliance with all ZMOD conditions and proffer commitments regarding screening and buffering;
• Architectural plans and elevations;
• Geotechnical reports;
• Erosion and sediment control plans;
• Fire marshal approval;
• VDOT approval for road connections and entrance improvements; and
• Documentation demonstrating compliance with all conditions of ZMOD approval and proffer commitments.
The site plan review process is administrative rather than legislative, and does not involve public hearings before the Planning Commission or Board of Supervisors. However, site plan review can be time-consuming, typically requiring several months and multiple rounds of review and revision. Building permits will not be issued until site plan approval is obtained.
Based on our current project schedule, IHDC intends to submit the initial site plan in November 2025, following ZMOD approval. A&W and Lumen Ridge will lead the site plan preparation and submission process.
IV. Proffer Statement — Overview and Estimated Amounts
Under Virginia Code § 15.2-2303 and Loudoun County practice, ZMOD applications for data center use are typically accompanied by voluntary proffers — both monetary and non-monetary — addressing the community impacts associated with the proposed development. While proffers are technically voluntary, as a practical matter, the submission of a proffer statement is a de facto requirement for ZMOD approval in Loudoun County. The scope and amount of proffer commitments are a major focus of staff review, Board deliberation, and community engagement.
Based on A&W's analysis of recent comparable ZMOD approvals for data center projects in Loudoun County and preliminary discussions with County staff, we estimate the following proffer framework for the Stonebridge Campus:
Estimated Proffer Rate: $5.00 per square foot of gross floor area.
Estimated Gross Floor Area: 480,000 square feet (four buildings × 120,000 square feet per building).
Total Estimated Monetary Proffer Payment:
480,000 sq ft × $5.00/sq ft = $2,400,000
This estimate is preliminary and is subject to revision based on the outcome of the pre-application conference, staff feedback during the review process, and negotiations with the Board of Supervisors. In addition to the monetary proffer, the proffer statement will include a number of non-monetary commitments addressing specific community impacts. The proffer statement is expected to address the following categories:
• Fiscal Impact Proffers (Cash Contributions). A cash proffer payable to the County at specified milestones (typically at the time of building permit issuance or occupancy permit issuance for each building) to offset the fiscal impacts of the development on County services. The per-square-foot rate will be negotiated with County staff and the Board.
• Transportation Improvements. Commitments to fund or construct specific road improvements in the vicinity of the Site, which may include turn lane improvements on Belmont Ridge Road, traffic signal upgrades or installations at the intersection of Belmont Ridge Road and Stonebridge Boulevard, and contributions to the County's Capital Improvement Program for road improvements serving the area. The scope of transportation proffers will be informed by the traffic impact analysis.
• Noise Mitigation Measures. Commitments to install and maintain noise attenuation measures, which may include sound barriers (walls or berms) along property boundaries, specification of low-noise mechanical equipment, operational restrictions on emergency generator testing (e.g., limiting testing to daytime hours), and ongoing compliance monitoring. The noise study will inform the specific measures proposed.
• Visual Screening and Landscaping. Commitments to install and maintain enhanced landscaping, berms, perimeter screening walls or fencing, and architectural treatments (e.g., articulated building facades, earth-tone color palettes, parapet walls to screen rooftop equipment) to minimize the visual impact of the data center campus from public roadways and adjacent properties.
• Stormwater Management Enhancements. Commitments to stormwater management measures beyond minimum regulatory requirements, which may include bioretention facilities, rain gardens, or contributions to regional stormwater improvement projects.
• Community Amenities or Contributions. Depending on Board and community expectations, the proffer statement may include commitments to fund community amenities such as trail connections, park improvements, or other public facilities in the vicinity of the Site.
The proffer statement will be drafted by C&H in coordination with A&W and Cornerstone, and will be submitted as part of the initial ZMOD application package in draft form. The draft proffer statement is expected to undergo significant revision during the staff review period based on feedback from DPZ, DTCI, and other County agencies, as well as input from the Dulles District Supervisor and the Board of Supervisors as a whole.
A separate internal memorandum on proffer negotiation strategy will be prepared by C&H in May 2025, analyzing recent comparable data center ZMOD proffers in Loudoun County for benchmarking purposes, identifying the range of proffer commitments that the Board is likely to expect, and recommending negotiation positions for each proffer category.
The estimated proffer cost of $2,400,000 is included in the project's $14,200,000 entitlements and soft costs budget line. IHDC's development team should be aware that the final proffer amount may exceed this estimate, and the project budget should accommodate a reasonable contingency for proffer escalation.
V. Detailed Timeline
The following table sets forth the anticipated milestone dates for the ZMOD process in the context of the broader Stonebridge Campus project development schedule:
This timeline is aggressive but achievable, provided the application materials are complete and professionally prepared at the time of filing, the pre-application conference does not reveal unanticipated issues requiring significant additional analysis, and the project does not encounter substantial community opposition or political headwinds at the Planning Commission or Board level. Each milestone on the timeline is interdependent, and delays at any stage will cascade through the subsequent stages.
The timeline assumes that the Board of Supervisors acts on the application at a single hearing in October 2025 and does not defer the application to a subsequent meeting. Deferrals are not uncommon, particularly if proffer negotiations are not fully resolved or if Board members have outstanding questions. A&W and Cornerstone will manage the relationship with the Dulles District Supervisor and other Board members to minimize the risk of deferral.
VI. Interrelationship with Other Project Milestones
The ZMOD process does not occur in isolation. It is one of several critical-path workstreams in the overall Stonebridge Campus development, and the timing of ZMOD approval has direct implications for land acquisition, construction financing, EPC contract execution, and power procurement. This section discusses the key interdependencies.
A. Land Acquisition Closings
The Stonebridge PSA (to be executed on or about April 15, 2025) provides a 90-day due diligence period expiring July 14, 2025. The Meridian PSA (to be executed on or about April 22, 2025) provides a 75-day due diligence period expiring July 7, 2025. Both land closings are targeted for September 15, 2025.
The ZMOD application must be filed before the land closings occur, because at the time of filing, IHDC will not yet be the record owner of either parcel. Under Loudoun County's ZMOD application requirements, an applicant that is not the record owner of the subject property must submit authorization letters from the current owners consenting to the filing of the application on their behalf. Accordingly, authorization letters will be required from:
• Blackthorn Realty Group, Inc. (Stonebridge Parcel), to be executed by the authorized signatories, Donald R. Whitaker and/or Patricia Whitaker-Connolly. Blackthorn's counsel is Whitfield, Poole & Stratton LLP (Harrison Poole, Esq.).
• Meridian Acres LLC (Meridian Parcel), to be executed by the authorized signatory, Theodore Ashford. Meridian's counsel is Dunleavy & Marsh, PLLC (Fiona Dunleavy, Esq.).
C&H will coordinate with sellers' counsel to obtain these authorization letters. It is essential that the Stonebridge PSA and Meridian PSA include explicit cooperation covenants requiring the sellers to (a) execute the authorization letters in form reasonably satisfactory to IHDC, (b) cooperate with the ZMOD application process, including executing any additional documents or certifications required by the County, and (c) refrain from taking any action that would interfere with or adversely affect the ZMOD application. These cooperation covenants should be drafted as affirmative obligations of the sellers that survive through the closing date and, ideally, through the ZMOD approval date. The inclusion and enforceability of these provisions should be confirmed during PSA negotiation.
An important sequencing issue warrants attention: the land closings (September 15, 2025) are scheduled to occur before the anticipated ZMOD approval (October 2025). This means that IHDC will close on the acquisition of both parcels — committing a significant capital investment — before ZMOD approval is finalized. If the ZMOD is ultimately denied or materially conditioned in a manner unacceptable to IHDC, IHDC will own two parcels on which the intended data center use is not permitted.
This sequencing creates a meaningful risk that must be addressed through one or more of the following mechanisms:
• Inclusion of a ZMOD-related contingency or condition in the PSAs (e.g., a condition permitting IHDC to terminate the PSAs and receive a return of deposits if the ZMOD is denied or not approved by a specified date);
• Structuring the PSA closing as a conditional closing, with a portion of the purchase price held in escrow pending ZMOD approval;
• Negotiating a post-closing purchase price adjustment or termination right tied to ZMOD approval; or
• Accepting the risk, in light of the overall probability of ZMOD approval and the strategic importance of controlling the parcels.
A separate memorandum analyzing the risks and mitigation strategies associated with the gap between land closing and ZMOD approval, including the implications for the construction lender and title insurance, will be prepared by C&H.
B. Construction Financing
The construction loan commitment letter from Summit National Bank, N.A. ("Summit"), as Administrative Agent, is targeted for August 1, 2025. The construction loan closing is targeted for October 15, 2025. The total construction loan facility is expected to be approximately $390,000,000.
Summit's lender's counsel is Redmond & Calloway LLP (Victor Redmond, Esq.).
It is highly likely that Summit will require ZMOD approval as a condition precedent to either (a) the construction loan closing itself or (b) the first draw under the construction loan facility. This is a standard lender requirement in development financings involving land use entitlements, as the lender's collateral value and the feasibility of the project depend on the borrower's ability to construct and operate the intended use on the property. If ZMOD approval has not been obtained by the construction loan closing date, Summit may decline to close the loan, or the loan documents may provide for a delayed initial draw until the ZMOD is approved.
The tight sequencing between the anticipated ZMOD approval (October 2025) and the construction loan closing (October 15, 2025) creates a significant risk. If the ZMOD approval is delayed — for example, due to a Board deferral at the October hearing — the construction loan closing may need to be postponed, which in turn will delay EPC NTP and the overall construction schedule. This risk will be addressed in a separate analysis memorandum regarding the impact of conditional or delayed zoning approval on the closing and financing timeline. Early engagement with Redmond & Calloway LLP is essential to ensure that the loan documents are structured to accommodate reasonable variations in the ZMOD approval timeline.
C. EPC Contract and Notice to Proceed
The Engineering, Procurement, and Construction ("EPC") contract for the Stonebridge Campus is targeted for execution on October 20, 2025, with the formal Notice to Proceed ("NTP") to be issued on November 1, 2025. The EPC contract provides for a 24-month construction duration from NTP, with the following substantial completion milestones:
• Building A Substantial Completion: August 1, 2027
• Buildings B, C, and D Substantial Completion: November 1, 2027
ZMOD approval is effectively a prerequisite to NTP, as construction cannot lawfully commence on the Site without the approved zoning entitlement in place. While certain pre-construction activities (e.g., final engineering, procurement of long-lead-time equipment) may proceed in parallel with the ZMOD process, physical site work — including grading, utility installation, and foundation construction — cannot begin until the ZMOD is approved and site plan approval is subsequently obtained.
Any delay in ZMOD approval beyond October 2025 will directly cascade into the construction schedule, pushing back NTP, substantial completion dates, and ultimately the delivery of the data center campus to IHDC's end-user tenants. Given the competitive dynamics of the Northern Virginia data center leasing market and the time-sensitivity of tenant commitments, schedule slippage carries significant commercial risk.
D. Power Procurement
IHDC is negotiating a Large Load Service Agreement ("LLSA") with Vantage Power Cooperative ("VPC") for the delivery of 120 MVA of electrical capacity to the Stonebridge Campus under a 10-year term. In connection with the LLSA, IHDC is also negotiating a Line Extension Funding Agreement ("LEFA") pursuant to which IHDC will contribute approximately $18,500,000 toward the cost of constructing the electrical line extension and substation facilities necessary to serve the campus.
The VPC substation will be located on the Meridian Parcel and will require a substation easement agreement granting VPC the right to construct, operate, and maintain the substation on a designated portion of the Meridian Parcel. The substation easement agreement is being negotiated separately and will need to be coordinated with the ZMOD conditions, as the substation location and design will be depicted on the GDP and addressed in the ZMOD proffer statement.
The target date for substation energization is June 1, 2027, approximately six months prior to the substantial completion of Buildings B through D. VPC's infrastructure planning, permitting, and construction for the substation and line extension facilities are proceeding on a parallel track. ZMOD approval is relevant to VPC's process in several respects: VPC needs assurance that the data center use is entitled before committing to the capital expenditure for the substation and line extension; the substation site plan must be consistent with the approved ZMOD conditions; and VPC may need to reference the ZMOD approval in its own permitting applications with the Virginia State Corporation Commission or other regulatory bodies.
IHDC's power procurement team should keep VPC informed of the ZMOD timeline and any changes to the anticipated approval date.
VII. Key Risks and Considerations
A. Timing Risk
The most significant risk to the Stonebridge Campus project presented by the ZMOD process is the risk of delay in ZMOD approval beyond October 2025. As discussed in Section VI, a delay in ZMOD approval would have cascading impacts on the construction loan closing (October 15, 2025 target), EPC NTP (November 1, 2025 target), and the overall project schedule and budget. A one-month delay in ZMOD approval could result in a corresponding or greater delay in NTP, which would push back the delivery of Buildings A through D and the project's revenue commencement date.
Potential causes of delay include:
• Application Completeness Deficiencies. If the ZMOD application is determined to be incomplete upon submission, the review clock pauses until supplemental materials are provided. This risk is mitigated by thorough preparation and coordination with A&W and Cornerstone.
• Extended Agency Review. If referral agencies (particularly DTCI, VDOT, or the Fire marshal) require additional analysis, studies, or revisions to the application materials, the review period may extend beyond the anticipated 60–90 days.
• Community Opposition. Organized opposition from adjacent property owners, homeowners' associations, or community groups can result in extended public hearings, Board member requests for additional analysis, and political pressure to deny or defer the application. See Section VII.B below.
• Planning Commission Deferral. The Planning Commission may defer action on the application to a subsequent hearing date if it determines that additional information is needed or if the Commission is divided on the recommendation.
• Board of Supervisors Deferral or Additional Conditions. The Board may defer action on the application at the October hearing, particularly if proffer negotiations are not fully resolved, if the Dulles District Supervisor has outstanding concerns, or if the Board desires additional community engagement. The Board may also impose conditions or require proffer enhancements that are unacceptable to IHDC, requiring further negotiation.
Mitigation strategies for timing risk include:
• Conducting the pre-application conference early (late April / early May 2025) to identify and address potential issues before the application is filed;