‘Balance’ Is Land Investor and Data Center Developer Chuck Kuhn’s Philosophy

Northern Virginia is the data center mecca, and Chuck Kuhn has found himself at its core.

Kuhn is the founder and CEO of JK Moving Services, a grassroots enterprise he founded as a teenager that is now the largest independent moving company in the country. Yet Kuhn is also a major land investor in his home region via his JK Land Holdings, and regularly makes massive parcel deals to data center hyperscalers for eye-popping sums. 

While the entrepreneur is the largest private landowner in Virginia’s Loudoun County, he’s also a proud conservationist, and has placed much of that land (more than 22,000 acres) into conservation easements alongside his digital infrastructure deals. 

Kuhn recently sat down with Commercial Observer to discuss the challenge in balancing land preservation and responsible development. He also talked about his career origins (which involve a childhood move to an unlikely destination), how his firm finds suitable locations for data center hyperscalers, and how he views his role in an industry that is evolving at lightning speed.

This interview has been edited for length and clarity. 

Commercial Observer: You founded JK Moving Services at age 16. When you think about that era, what made you so entrepreneurial? What were your goals at the time?

Chuck Kuhn: It was back in May of 1982. I was in high school, and I decided that I was not going to move forward to college and that I needed to figure out what my career was going to look like. I had gained knowledge of the moving and storage industry while working for my uncle as a young guy on weekends. So that year, I got my driver’s license and bought my first truck with $5,000 that I had earned working for my uncle. I was never the best student. Always a hard worker, but never the best student, and never really enjoyed going to school. But I loved working with my hands, loved working with people. 

In the late 1970s, my parents were working with C&P Telephone Company in Northern Virginia, and American Bell Telephone Company (now part of AT&T) approached them and asked if they’d like to go to Iran and work on a three-year project to improve the country’s telecommunications. My parents accepted the proposal — they thought it would be a good opportunity for us to see the world. 

The move over to Iran was an epic disaster with the moving company that we utilized. But when we got overseas, it was great. We were welcomed, we were looked at as a group coming to improve the country. It’s a beautiful country; beautiful mountains and great opportunities. And for about the first 18 months, it was fantastic.

But then the revolution took place, and we went from heroes to zeros overnight. It was a very contentious, borderline dangerous situation, and we were happy to get out of there. Very unfortunate. It was a total change from the time we arrived to the time we left. 

So, the move to Iran was a bit of a disaster. But then halfway through that commitment, the revolution happened. The Shah was overthrown, and we were shipped back early. [A few years later] I learned about the moving industry while working with my uncle after all of that, and thought, you know, we can make a difference in this industry. We can help take the stress out of relocation. 

It sounds like there’s a through line between your experiences in Iran and you deciding you were going to try to streamline the moving process to make this easier for people.

No question whatsoever. It was a combination of needing to find an area of focus for a career — the only trade I really knew was the trade of moving and storage, working with my uncle — and understanding how stressful and how upsetting a poorly executed move can be on a family. And so I thought, OK, here’s an area where we can make a difference. Here’s an area with a true need. And that really drove me to start JK Moving. 

What I didn’t know at that young age was the impact of high interest rates. And if we think about May of 1982, interest rates were in the high teens, I think literally 16 to 18 percent. I had no idea what the impact of high interest rates meant on the housing market or on the ability to get an affordable loan to buy equipment. So we started at a very challenging time. But fortunately, I didn’t realize the impact, so I didn’t let the impact really bother us. We just kind of pushed through to grow the business. 

Meanwhile, data center momentum in Northern Virginia really began to escalate in the 1990s during the dot-com era. Was demand for these facilities in the region something you had been aware of back then, or was it more a recent revelation for you?

JK moved its headquarters to Loudoun County, Va., from Fairfax County in the late 1990s. We had built a 100,000-square-foot warehouse on approximately 20 acres, and I received the key to the county. 

At the same time, Steve Case of AOL was also receiving the key to the county. So we both went to the celebration and both received our keys together, and that’s the first time that I learned of American Online. They were building their business while we were building our business literally three miles away. And then three data centers — the first three data centers ever in Loudoun County — were built off of what is now the Dulles Greenway toll road, and they sat there empty forever. People talked about them being data centers, and the cloud. But I really didn’t understand it, to be honest.

I went about growing the moving business, and we were buying commercial ground in Loudoun County for the intent of growing JK Moving. We would buy ground, build a building, and the business would grow, and we would build another building. Warehouses, flex buildings, light industrial storage, most of which we would own and occupy for JK, and others that we would lease out. In the early 2010s, a broker we worked with a lot at KLNB, Kevin Goeller, called me about a site at the intersection of Route 606 and 28 and said, “I’ve got a great site for you for warehouses. But if you elect to not build warehouses, we can build data centers on it.” And I said, “But I don’t know anything about data centers.”

So, we acquired the property intending to build warehouses. But then one of the hyperscalers [a developer for Amazon] called and said, “Hey, we would like to buy the property.” And I said, “Well, thank you very much for your interest, but we have a plan. We’re building warehouses on the property, not interested in selling it.” 

Still, they sent in an unsolicited offer. I said, “Thank you, but no thank you. We’re building warehouses on it.” And they sent in another offer, and I told them, “Thank you, but no thank you, we’re building warehouses.” Then they sent in a very substantial offer. And I thought, wow, these guys want this property more than I do. So we ultimately sold it to them. 

Fifteen years ago, it was so much easier to do business in the county, and you were, at the time, allowed to build data centers on any land zoned “Planned Development-General Industrial” or zoned “Planned Development-Industrial Park.” So when we bought the ground for warehouses, any of the land zoned for warehouses in the county at the time was also zoned for data centers by-right. And that has since dramatically changed.

Not long after this, you acquired two other parcels in the region that you had originally intended for other industrial use, but ultimately received offers from data center developers that you couldn’t refuse. You founded JK Land Holdings in 2016, and, since then, the return on investment in a number of these parcel deals is stunning: your $615 million sale of 97 acres to SDC Capital last Fall, for example, after having acquired and assembled it for about $60 million just a few years earlier. How can you tell which assemblages will pull that kind of interest from potential buyers? 

When you look at it, there’s really only five big users of data center services across the globe — Amazon, Microsoft, Google, Meta and Apple — whether it be for cloud computing or for AI. And AI is certainly growing and changing, but historically, there’s been five real users, and so after a while you get to understand their fiber needs, their power needs, their physical building and plant layout needs. We try to look for sites that cater to those five, that are in a proximity that works for them, that work with any air-quality concerns, that we can get power delivered. 

What we do is a little bit different than some of our competition. Sometimes we’re working directly with the hyperscalers, and they’re directing us to sites that they may need or want in the future and, for whatever reason, they’re not able to land bank or acquire the ground in its current condition, but they like the site. Sometimes we’re just using our own experience and intuition, kind of understanding the patterns of the users and the needs of the users, and we try to create an environment that makes it very, very easy for our user to acquire and put the site into quick use. So they may be paying a little bit of a premium on some of our sites, but they’re not carrying the site. The site’s already entitled. We typically get our site plans fully approved, grading permits, all the utilities in place. So when they acquire our sites, they’re ready to move. 

So if it’s a developer working on behalf of a hyperscaler, or if we’re working on behalf of the hyperscaler with minimal downtime, they’re able to get a fast return on investment for the acquisition. And we also take all the speculation out of it. When we sell a site or develop a site, they’re fully entitled. The power situation is completely fleshed out. The fiber situation is completely fleshed out. Water, sewer, all the utilities are either in place and ready, or there’s a definitive timeline for it to happen.

It’s never easy, and it’s getting more and more challenging, but this is what we do. It’s truly what we’re focused on for six, seven days a week, and we’ve got a very experienced team, small but effective. And we try to listen carefully to what the counties, states, towns and communities need, want and do not want, and we try to put together a package that accomplishes everything the communities are looking for. It’s not always easy and not everybody wants to see data centers in their community. But data brings tremendous benefit to these locations. 

When it comes to local communities, what are they typically looking for? 

It’s very interesting. There’s always a group that does not want data, period. There’s a lot of people that jump on the bandwagon with that. But with that said, in every county we work in, every state we work in, every jurisdiction we work in … it’s a relatively small percentage of the people. A lot of them have solid and good reasons [for opposing data center development], but there is a huge portion of the population of these counties and states that recognize all the benefits that data is bringing to the world. 

When you look at the amount of job creation, the amount of tax revenue, the benefits to non-data. … In our hometown of Loudoun County, for example, our hotels, our restaurants, our car dealerships, our gas stations, our stores are all seeing tremendous benefit by the growth and development of data and AI in our marketplace. If you remove all of that, our county is shrinking, not growing. Jobs are shrinking, not growing. I’m a strong believer that data centers do not belong everywhere, and responsible, sensible development needs to take place. The proximity of data to residential developments, the proximity to data to schools and churches and other areas. You have to have proper berming, proper landscaping, proper screening and good common sense about where you’re developing. Data does not belong everywhere. At the same time, the answer isn’t to just not build data anywhere. We’ll fall behind as a country if we’re not advancing in technology and AI development.

You also have a passion for land preservation, having placed over 22,000 acres into conservation easements. Yet data centers are sometimes criticized as detrimental to the environment in terms of water and power usage, and noise. How do you strike a balance between the demands of data center development and conservation? Particularly in Northern Virginia, which has seen so much data center activity over the past few decades.

It’s a never-ending challenge to create a balance everywhere in life and in development. 

One, there’s a lot of mistruths out in the marketplace about data centers and water consumption. I’ll show you data centers that we own and that we operate that use less water than your typical warehouse in the county. We have data centers that are truly only using water to flush toilets and wash hands in the sink. These are air-cooled data centers that are using literally no water for cooling. So, you hear about all this crazy water consumption, and that’s really not true. 

I’m not saying there’s not a data center somewhere, one of the old-style designs, that’s a consumer of water, but most of the data centers in our county are either air-cooled or using a recirculating water cooling system, liquid to chip, and it functions more like a radiator in a car. It uses water for cooling, but it’s not a consumer of water. So I think first you have to separate fact from fiction, and then really drill into the resources that the data centers are actually using. 

They’re certainly big consumers of power. Nobody can hide from that. But I think there’s a lot of innovation coming. I’m a big believer in small modular reactors. You see a lot of data centers now utilizing natural gas … but they’re certainly big users of power. 

With respect to the land, I think having good master plans in the counties, good zoning in the counties, and developers that are using good common sense about where and what they’re building, and the look of what they’re building, all that plays into the role of balance. And for JK Land Holdings, every acre of land we’re developing, it’s probably 7-to-1 in terms of conservation. So we’ll develop 1 acre, and we’ll place 7 acres into conservation easement. So we’re trying to do our best to create as much balance anywhere we’re developing. 

Regarding the future of the data center development in Northern Virginia, where do you see the industry going forward and your role within it? Some critics say that investment in data centers and AI is a bubble reminiscent of the dot-com era.

I think it’s critical that we keep our data on U.S. soil. I think it’s critical to our country’s future that we stay on the leading edge with respect to technology development, AI development, and quantum computing. If you start forcing data and AI out of our counties, out of our states, out of our country, if we don’t improve our power situation fast enough and get newer technologies approved, we’re going to continue to fall behind other leading countries around the world, which I think is dangerous for all of us. 

So with respect to JK Land Holdings specifically, we’re going to continue with responsible development. We’re going to continue with responsible balance and conservation easements, and try to create balance where we can create it. We’ll identify ground and the appropriate areas for data and AI, along with other commercial and industrial warehouse uses. We’re still building warehouses and commercial projects, and we’ll continue to try and lead responsibly, while thinking about the impacts of the community, the impacts on the resources in the community, and create balance to the best of our ability.

Nick Trombola can be reached at ntrombola@commercialobserver.com.