Photo Caption: Located at 1980 Caterpillar Rd in unincorporated Delavan Township, this former Caterpillar facility, recently operated by SC2 and now owned by Phoenix Investors, is being repurposed as part of the company’s expanding industrial and data center development portfolio..
Delavan’s Data Center Debate
Purchase of Former Caterpillar Facility Sparks New Concern
By Robert Fang
Published: July 26, 2026
The recent purchase of the former Caterpillar facility at 1980 Caterpillar Road by Wisconsin-based Phoenix Investors has sparked both interest and concern throughout the Delavan area, as residents, local officials and business leaders seek answers about the future of one of Tazewell County’s largest industrial properties.
Phoenix Investors, a Milwaukee-area real estate investment firm and developer, has built a national reputation through the acquisition and redevelopment of large industrial sites. In recent years, the company has become increasingly associated with data center projects and the conversion of former manufacturing facilities into digital infrastructure hubs.
That track record has fueled speculation among some Delavan-area residents that the sprawling Caterpillar property could eventually be repurposed as a data center. However, Phoenix Investors has not publicly announced any plans for the site and has not shared its intentions with the Delavan Dispatch, Delavan government officials or Tazewell County leaders.
As a result, questions about the facility’s future remain unanswered.
The property, located in unincorporated Delavan Township just outside the Delavan city limits, consists of more than one million square feet of industrial and warehouse space. While ownership has changed hands, the site is not vacant. At least one shift of workers continues to operate at the facility, and the property remains an active workplace.
The uncertainty surrounding the site’s future has generated considerable discussion throughout the community, particularly as data center development has become a contentious issue in many rural communities across Illinois and the nation.
Among those expressing concern is Delavan Mayor Adam White, who said city leaders intend to work with Delavan Township and Tazewell County officials to oppose any effort to convert the former Caterpillar complex into a data center.
“I believe there is a need for data centers,” White said. “But there are more suitable places for them.”
White cited the significant demands data centers can place on electrical and water infrastructure as reasons he believes the Caterpillar Road property would be an inappropriate location for such a development.
Despite the mayor’s position, the City of Delavan has limited authority over what ultimately occurs at the site. Because the facility lies outside city limits, zoning and land-use decisions fall under the jurisdiction of Tazewell County rather than the city government.
According to a source within Tazewell County government familiar with the matter, the property’s current zoning would permit a data center to operate at the site regardless of any future county regulations specifically targeting data centers, provided the project remains within the property’s existing zoning and building parameters. The source said county officials would likely only gain direct regulatory authority if the property owners sought a zoning variance or permits for new construction, expansion or other significant modifications to the site.
Not everyone in city government, however, agrees that opposition is the best approach.
Ward 3 Alderman Linda Slabaugh has emerged as the lone public voice on the Delavan City Council advocating for engagement with potential data center development rather than outright resistance.
Slabaugh criticized the city’s decision to remove itself from discussions regarding annexation, data center regulations and future planning.
“I think the City of Delavan voting to opt out of any discussion about annexing the facility, passing any ordinance or even conversing about a data center is unwise,” Slabaugh wrote. “I understand people’s concerns about data centers, but this technology is moving forward whether Delavan actively participates or not. Rather than being passive bystanders, I think the City of Delavan should have taken a proactive approach.”
Rather than opposing data centers altogether, Slabaugh argued that local governments should focus on establishing safeguards to address residents’ concerns.
Among the measures she proposed were landscaped eight-foot berms and evergreen tree buffers to reduce noise and visual impacts, setbacks of 200 to 300 feet from neighboring properties, closed-loop cooling systems to prevent excessive withdrawals from the Mahomet Aquifer and agreements requiring developers to cover infrastructure costs rather than shifting those expenses to local ratepayers.
Slabaugh also suggested negotiating community-benefit agreements that could direct investment toward local projects.
“Some areas have had great set asides that have funded schools, hospitals and even a community swimming pool,” she stated.
While acknowledging that Tazewell County is currently pausing consideration of data center petitions, Slabaugh said residents can still participate in county-level discussions and argued that communities such as Delavan can learn from successes and mistakes made elsewhere.
“I see the data centers, if done properly, as an opportunity for rural communities to flourish,” she said.
She further noted that the broader issue is likely to remain relevant.
For now, residents are left with more questions than answers.
Until Phoenix Investors publicly outlines its plans for the property, the future of 1980 Caterpillar Road will remain a topic of intense interest—and growing debate—throughout Delavan Township and the surrounding area.
Located at 1980 Caterpillar Rd in unincorporated Delavan Township, this former Caterpillar facility, recently operated by SC2 and now owned by Phoenix Investors, is being repurposed as part of the company’s expanding industrial and data center development portfolio.
Delavan’s Data Center Debate
Purchase of Former Caterpillar Facility Sparks New Concern
The recent purchase of the former Caterpillar facility at 1980 Caterpillar Road by Wisconsin-based Phoenix Investors has sparked both interest and concern throughout the Delavan area, as residents, local officials and business leaders seek answers about the future of one of Tazewell County’s largest industrial properties.
