From Mill to Data Center: A Step-by-Step Guide to Repurposing Rural Industrial Sites
Introduction
When the Androscoggin paper mill in Jay, Maine—a rural town northwest of Portland—shut down permanently in 2020 after a pulp digester explosion, it left a 1.4-million-square-foot facility vacant and 1,500 jobs lost. Yet by 2023, a joint venture led by developer Tony McDonald had purchased the site, dismantled its machinery, shipped it to Pakistan, cleaned up the industrial mess, and finalized a resale agreement to turn the property into a data center. This remarkable transformation offers a blueprint for other rural communities facing industrial decline. In this how-to guide, we walk you through the key steps to convert a closed industrial facility into a data center, using the Jay example as a case study. Whether you’re a local government, a developer, or a community leader, these steps can help you attract high-tech investment and breathe new life into old infrastructure.
What You Need
- An abandoned industrial facility (e.g., a paper mill, steel plant, or factory) with enough square footage for a data center (typically 100,000+ sq ft).
- Environmental assessment reports to identify contamination and remediation needs.
- Demolition and dismantling contractors skilled in heavy machinery removal.
- Regulatory permits for demolition, hazardous material handling, and construction.
- Capital investment from a joint venture, holding company, or private equity group.
- Legal expertise to negotiate purchase agreements and resale contracts.
- Community support and local government approvals.
- Data center developer or operator ready to take over the site.
Step-by-Step Process
Step 1: Assess and Acquire the Property
Begin by conducting a thorough evaluation of the closed facility. In Jay, the former mill’s massive footprint (1.4 million square feet) and its existing infrastructure—power supply, water access, and structural soundness—made it attractive for redevelopment. Form a joint venture or partnership with holding companies and capital firms to pool resources. Developer Tony McDonald’s group, JGT2 Redevelopment, worked with multiple partners to secure the site. Obtain environmental audits to understand cleanup costs, and negotiate a purchase price that accounts for future expenses. Secure all necessary permits for demolition and environmental work before closing the deal.
Step 2: Dismantle and Remove Industrial Machinery
Once you own the property, the next task is clearing out outdated equipment. In Jay, the team spent three years breaking down the mill’s machinery—digesters, conveyors, and paper-making lines—and shipping it to buyers abroad, such as Pakistan. This step requires careful planning: identify salvageable equipment to sell (offsetting costs), hire specialized rigging and demolition crews, and manage hazardous materials like asbestos or oil. Create a timeline that aligns with environmental remediation. Document the removal process for resale disclosure.
Step 3: Environmental Remediation and Site Cleanup
Industrial sites often carry contamination from decades of operation. The Jay mill required extensive cleanup before it could be remarketed. Work with environmental engineers to remove toxic sludge, treat groundwater, and stabilize soil. In some cases, you may need to demolish non-reusable structures. Obtain a “clean closure” certification from environmental agencies. This step is critical to attract data center developers, who need a clean slate for sensitive equipment. In Jay, the cleanup made the site marketable for resale in early 2025.
Step 4: Prepare the Site for Redevelopment
After cleanup, prepare the property for its new purpose. This often means grading land, upgrading power capacity, and ensuring fiber-optic connectivity. Data centers require high-voltage electricity and redundant internet connections. In rural areas like Jay, you may need to work with local utilities to boost grid capacity. Also, evaluate existing buildings—some structures may be repurposed as server halls, while others need replacement. Create a site plan that shows potential layouts for data center pods and cooling systems.
Step 5: Secure a Data Center Developer and Finalize the Sale
Market the cleaned and prepared site to data center developers, colocation providers, or tech companies. The Jay property was sold through a resale agreement finalized in early 2025 (exact buyer not disclosed in the original story). Negotiate terms that may include leasebacks, tax incentives, or community benefits agreements. Ensure the buyer has financial backing and a track record of data center construction. Once the sale is complete, the developer takes over for the final step.
Step 6: Transition to Data Center Operation
After the sale, the new owner will begin constructing the data center. This phase includes installing server racks, cooling systems, backup generators, and security infrastructure. For rural communities, this phase can bring construction jobs and eventual long-term employment, though fewer than the original mill (data centers are capital-intensive, not labor-intensive). The Jay example shows that a paper mill can evolve into a high-tech hub—similar projects now dot rural America.
Tips for Success
- Engage the community early: Hold town halls to explain the job impacts and tax benefits. Data centers offer skilled maintenance roles, not the huge workforces of old mills.
- Leverage tax incentives: Many states offer abatements for data centers; use them to attract developers.
- Plan for power needs: Data centers consume vast electricity. Partner with utilities to build new substations or upgrade lines.
- Think about environmental legacy: Proper remediation not only satisfies regulators but also prevents future liability.
- Document everything: Keep records of dismantling, shipping, and cleanup for due diligence during resale.
- Consider a multi-purpose reuse: The site could also host solar farms or battery storage alongside data centers.
By following these steps, rural communities can transform shuttered industrial giants into engines of the digital economy. The Jay, Maine mill is proof that with careful planning and partnerships, a paper mill can become a data center—and rural America can plug into the future.