Zone Frontier signs 30-year lease for Texas data center campus

Zone Frontier Inc. has entered into a long-term ground lease for approximately 4,077 acres in Potter County, Texas, securing land, water, and development rights for a new data center campus. The agreement, announced September 29, 2026, covers a site designated for AI infrastructure in partnership with HST Technologies, Inc. The lease grants Zone the option to purchase the data center site and includes a long-term water supply agreement co-terminous with the 30-year initial term, which offers two 10-year extension options.

Under the terms of the lease, Zone may designate between 200 and 800 acres for data center facilities and related infrastructure. The remaining portion of the property, at least 1,800 acres, is reserved for solar generation, battery storage, and supporting infrastructure. Base rent for each site area does not commence until construction begins on that specific area, a structure that aligns land costs with development milestones. The site surrounds Southwestern Public Service Company’s existing Potter County 345 kV substation in the Southwest Power Pool region, which the company believes provides a potential path to grid interconnection alongside dedicated on-site generation.

The campus is sized to an initial 200 megawatts with the potential to expand beyond 500 megawatts. Zone Frontier stated that the site’s proximity to two major natural gas pipelines and favorable access to fiber services make it well suited for a large-scale solar and battery plant. Tyler Hassen, Chief Executive Officer of Zone Frontier, described the agreement as securing land at scale, a faster path to power, and water under one long-term arrangement. Hassen noted that the lease structure allows the company to advance tenant acquisition, power studies, and permitting in a disciplined sequence without committing significant capital before key pieces are in place.

Zone Frontier is currently focused on securing tenants and completing power and interconnection studies. As tenant discussions progress, the company will evaluate financing options with co-investment equity partners and project finance lenders. The Texas campus is part of Zone’s broader pipeline of AI infrastructure projects designed to meet increasing demand for compute power. The company’s portfolio also includes a Minnesota data center campus with an initial 10-year Colocation Services Agreement with Cerebras Systems, Inc. That Minnesota project is making material construction progress, and Zone expects to generate revenue from it beginning in the first half of 2027. Project finance discussions for that campus are also progressing consistent with previous guidance.