Intel Invest $20 Billion Into Silicon Heartland: Columbus Ohio

Intel Invest $20 Billion Into Silicon Heartland- Columbus Ohio

In January 2022, Intel announced its plans for a $20 billion investment to build two new semiconductor fabrication plants, known as “fabs,” in New Albany, Ohio. This decision marks the largest private-sector investment in Ohio’s history and will have immense economic impacts on the region and state. The $20B investment is causing Ohioans to get priced out of their own homes and now many Columbus Ohio homeowners are looking to sell their house for cash in order to capitalize on the potential peak real estate market. 

New Albany beat out 40 other sites across the country to win the Intel project. The two fabs will be built on a 1,000-acre site in the New Albany International Business Park in Licking County, just east of Columbus. Construction is slated to begin in late 2022, with the first fab operational by 2025.

The Intel project is expected to create 3,000 direct Intel jobs, 7,000 construction jobs, and thousands of indirect jobs. The project will add $2.8 billion to Ohio’s annual gross state product. The average wage for the Intel jobs will be around $135,000 per year, well above the median household income for Licking County.

Beyond jobs and economic impacts, Intel has committed to $100 million in partnerships for STEM education and research collaborations across Ohio’s network of higher education institutions. This focus on education and research will help build a pipeline of talented workers for Intel and other tech companies in the state. 

Ohio leaders offered Intel an incentives package worth around $2 billion in tax breaks and infrastructure improvements to secure the project. The largest component is a 30-year tax break that allows Intel to invest $2 billion in the site without paying taxes on that equipment. Some critics argue these incentives are too high of a price for taxpayers. However, proponents note that the tax breaks are tied directly to Intel’s investment and point to the transformational potential of the project.

For New Albany, Intel’s arrival represents the crown jewel for a community that has worked for decades to develop a significant employment center. “This is our Super Bowl,” said New Albany City Manager Joseph Stefanov in response to winning the Intel bid.

New Albany has a population of just over 11,000 but has established itself as a growing suburb with excellent schools and amenities like golf courses, parks, and community events that draw affluent residents. Since the 1990s, New Albany has purposefully zoned and developed the International Business Park as a hub for advanced manufacturing, data centers, and professional services. Today the park has over 17,000 jobs with major employers like Facebook, Google, and AEP. 

Landing the Intel project represents a validation of New Albany’s long-term economic development strategy. In collaboration with JobsOhio, One Columbus, and other partners, the city has consciously built infrastructure, amenities, and a business climate to attract such large investments. While the Intel site is actually just over the border in Jersey Township, New Albany will be profoundly shaped by this development.

Intel’s two fabs will be built on a 1,000 acre greenfield site east of Beech Road and north of Jug Street Road. The site will hold two 270 acre fabs, each over 1 million square feet. Supporting the fabs will be additional buildings for administration, equipment storage, wastewater treatment, and other ancillary uses. 

Natural gas piping, electricity transmission lines, water supply, and other utility infrastructure will need to be extended to serve the facilities. Highway 161 which runs past the site will need to be widened to accommodate increased traffic. 

While the area is currently rural and sparsely populated, development pressures around New Albany will inevitably increase on the back of the Intel project. The city has already placed a 6-month moratorium on new residential zoning to assess how to responsibly manage growth related to Intel. Housing, roads, retail, recreation, and municipal services will all need to scale up to support the thousands of new workers coming to the area. Careful planning and strategic infrastructure investments will be needed to avoid low-density sprawl.

From an environmental standpoint, Intel has committed to 100% renewable energy use for its new fabs. Intel is developing on-site solar generation and signing agreements with regional wind and solar providers. A dozen groups also signed onto a Natural Resources Defense Council statement calling for Intel to mitigate impacts, maximize energy and water efficiency, and set greenhouse gas reduction targets.  

Water usage for semiconductor facilities is a concern, as a typical fab can use millions of gallons per day. Intel will need to obtain permits from the Ohio Department of Natural Resources to withdraw water from the Scioto River basin. Teaming up with the city of Columbus on water infrastructure and recycling will be crucial to Intel’s long-term water sustainability.

Intel has already begun clearing trees and moving dirt to prepare the site. But before full construction can begin, Intel needs to secure permits from the Ohio Environmental Protection Agency regarding stormwater and wastewater management on the site. With the support of JobsOhio and One Columbus, Intel is fast-tracking permitting to keep the project timeline on track.

Construction will start once permits are secured, likely in late 2022. The full build-out will take about 3 years, with the first fab coming online in 2025 and the second in 2026. The general contractors have not yet been selected, but Hunt Construction Group and Gilbane Building Company constructed Intel’s last U.S. fab in Arizona and are likely leaders for this project as well.

Thousands of construction workers will be hired through a variety of contractors. Part of the project labor agreement includes hiring local workers, minorities, women, and veterans. The Central Ohio Building Trades Council will be the main conduit for connecting trained union workers with opportunities. 

Once up and running, each fab will employ about 1,500 workers focused on semiconductor manufacturing, engineering, and related roles. Hiring is expected to begin before construction is fully finished. Intel has committed to strong representation of women and minorities, reflecting the diversity of the Columbus region.

With Ohio’s manufacturing heritage and existing semiconductor workforce, the region is well-positioned to supply talent. But continued investment in STEM education, research, and workforce partnerships will be crucial to developing the pipeline. Intel’s $100 million Ohio higher education grant will fund collaborations between universities and community colleges to educate the next generation of engineers, technicians, and designers needed to support the semiconductor industry.

The Intel fabrication plants represent a huge boon for Central Ohio and the Midwest as a whole. “The Silicon Heartland” is how Intel CEO Pat Gelsinger described Ohio in announcing the decision. While Silicon Valley has long dominated tech manufacturing, the chip shortage combined with geopolitical uncertainties highlighted the need for more resilient domestic production. 

With cutting-edge facilities and expertise in advanced manufacturing, Ohio is ready to anchor a new hub of semiconductor research and production in the heartland. Intel’s fabs will spur further clustering with upstream and downstream companies co-locating to be part of the ecosystem. 

The Columbus, Ohio Real Estate market is now positioned alongside established hubs like Arizona, Oregon, and Texas as a growing market. Intel’s investment will profoundly shape the innovation economy in Ohio for decades to come. While executing such a mega-project will not be without challenges, the opportunities far outweigh the risks.

Published by: Nelly Chavez

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