Microsoft Accelerates San Antonio Expansion with $400 Million Castroville Data Center Project

Microsoft expands its San Antonio footprint with the $400M SAT 82 data center in Castroville, set to boost local jobs and AI infrastructure by 2028.

By: AXL Media

Published: Mar 12, 2026, 7:02 AM EDT

Source: Information for this report was sourced from Bisnow, My San Antonio, and Connect CRE

Strategic Growth in the San Antonio Tech Corridor

Microsoft is significantly deepening its investment in the Far Westside of San Antonio with the announcement of a new data center in Castroville. Known internally as SAT 82, the project at 3580 FM 471 N will span approximately 195,000 square feet. This development is part of a broader "Community-First AI Infrastructure" initiative launched in early 2026, which prioritizes responsible growth and local partnerships as the tech giant scales its global Azure and AI capabilities.

Construction Timelines and Economic Impact

While state regulatory filings indicate a formal construction start date in August 2026, local observers report that heavy equipment and site preparation are already underway. The project is estimated to cost $400 million and is targeted for completion in June 2028. The construction phase alone is expected to generate nearly 1,500 local jobs and over 6 million labor hours, providing a substantial economic boost to the Medina County town of just 3,000 residents.

Sustainable Design and Resource Management

In line with Microsoft’s 2030 zero-waste and carbon-negative goals, the SAT 82 facility will feature advanced sustainability measures. The data center is designed to meet LEED Gold standards and will utilize air-cooled chillers that require minimal water for cooling. Furthermore, the company has committed to using renewable biofuels for its backup generators and sourcing recycled water through local providers like the East Medina County Special Utility District to ensure that potable water supplies for residents remain unaffected.