What began as 84 acres of farmland in Loudoun County, Virginia, turned into a $100 million windfall—and a lesson in the soaring value of data center real estate. Avison Young’s Net Lease Group recently completed a 1031 exchange, transforming the unexpected sale into a diversified portfolio designed for long-term income.
Jonathan Hipp, principal and head of Avison Young’s U.S. net lease group, and Richard Murphy, senior vice president in the firm’s capital markets group, led the team behind the transaction. The original farmland sale, earmarked for data center development, launched a $75 million reinvestment into 11 income-producing net-lease properties across the country, with another $25 million directed to non-income-producing land.
The resulting portfolio spans Florida, Georgia, North Carolina, South Carolina, Texas and Virginia, anchored by tenants such as Chick-fil-A, 7-Eleven, Wawa and Caliber Collision.
“It was just farmland,” Hipp tells GlobeSt.com. “He never expected that kind of money.”
He estimates the $100 million offer was roughly ten times what the parcel might have sold for as unimproved agricultural land. The price tag, Hipp notes, underscores the infrastructure demands driving data center development.
“For people to pay that kind of money, there’s got to be power around it,” he says, adding that water access is another critical factor.
“The land cost is inconsequential compared to what it is ultimately worth [as a data center location].”
Though sizable, the deal wasn’t Avison Young’s first in this space. “We had done some smaller ones, $5 million, $10 million, $15 million,” Hipp says.
What stands out now, he adds, is the rapid growth in data center-driven 1031 exchanges.
“The volume of inquiries we’re getting is insane," according to Hipp, the firm is currently managing a pipeline exceeding $200 million in data center land sales slated for 1031 exchanges in 2026.
Executing deals of this scale within the tight 45-day identification window can be complex.
“It’s a very complicated process to buy 11 different assets across six states,” Hipp says. Each transaction must be carefully timed with backups lined up in case any property fails during due diligence. But the payoff, as this Loudoun County farmland sale shows, can be transformative.
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