South Sacramento is in the middle of a fight that most property owners haven’t noticed yet. A New York based firm, Link Logistics, has asked SMUD for the power to run a large scale data center on a South Sacramento site. That single request has turned into a citywide debate about land use, power capacity, and who gets a say.

Who’s lined up on each side.

Mayor Kevin McCarty and Councilmember Eric Guerra have come out against the proposal. So has the Environmental Justice Coalition and Third Act Sacramento, both citing air quality, noise, and water and power strain on a site that already sits in a heavily impacted area. Mayoral candidate Flo Cofer has weighed in against it too.

On the other side, the Sacramento Region Business Leaders Council and the Data Center Coalition are pushing for it, arguing the project brings permanent, high wage jobs and real tax revenue. One developer compared the moment to the arrival of the railroad. State Senator Steve Padilla has authored legislation to study data center impacts more broadly, and Governor Newsom has to act on related bills by the end of September.

Why this matters if you own or lease industrial property nearby.

Data centers are power hungry in a way most industrial tenants aren’t. A single large facility can draw as much electricity as a small city. When SMUD allocates that kind of capacity to one user, it changes what’s available for everyone else on that grid, including the distribution, manufacturing, and cold storage tenants who’ve been the backbone of South Sacramento’s industrial base for decades.

There’s an upside case too. If this project or others like it move forward, they bring infrastructure investment, road improvements, and utility upgrades that can lift land values across the surrounding submarket. Landowners near approved data center sites in other markets have seen exactly that.

There’s a downside case as well. Community pushback like what we’re seeing here can slow permitting for every project in the area, not just the one drawing the objections. If you have a development or expansion planned in South Sacramento, the timeline risk just went up, regardless of how you feel about data centers specifically.

What to watch over the next few weeks.

Governor Newsom’s decision on the state legislation by the end of September will tell us whether this stays a local fight or becomes a statewide framework issue. Either way, SMUD’s response to the power request is the number that actually matters for industrial land values in this submarket. Power availability, not zoning, is quietly becoming the constraint that decides where the next generation of industrial development in Sacramento can go.

If you own industrial land or a building in the South Sacramento corridor, this is worth a conversation now, not after a decision gets made. I can walk you through what’s happening on your specific parcel and what it could mean for value.