AI Data Centers Near New Braunfels: What Homeowners and Buyers Should Know

If you've driven I-35 between New Braunfels and San Marcos lately, you've probably heard people talking about data centers. AI needs a huge amount of computing power, and Central Texas has become one of the busiest places in the country to build it.

Here's what is actually happening near us as of fall 2026, without the hype or the panic.

The Big One: CloudBurst

CloudBurst Data Centers is building an AI campus off Center Point Road, Francis Harris Lane and Huber Road. The site sits across the Hays and Guadalupe County lines. It has a New Braunfels mailing address, but it is outside New Braunfels city limits.

The numbers:

• $14.5 billion estimated investment on about 706 acres
• 10 to 12 buildings, about 3 million square feet
• 1.2 gigawatts at full build out, in phases, with the first 50 MW phase targeted for late 2026
• Powered by its own on-site natural gas plant, with gas supplied by Energy Transfer
• The developer says the buildings will use about 24,000 gallons of water a day with closed-loop cooling

In April 2026, the Guadalupe County Commissioners Court approved a 10-year tax abatement and development agreement by a 3-2 vote. Two months earlier, the same court had voted it down. Navarro ISD is expected to be one of the biggest beneficiaries of the future tax base.

The Lawsuit

In July 2026, Save Our Springs Alliance sued Guadalupe County on behalf of a group of residents. The suit challenges how the county handled both CloudBurst and a second project, Palomino Alpha. It alleges violations of the Texas Open Meetings Act, the Tax Code and conflict-of-interest law. The case is still pending.

Other Projects on the Radar

• Palomino Alpha is a proposed data center on about 870 acres in Guadalupe County. It's asking the Crystal Clear Special Utility District for up to 500,000 gallons of water a day. The district board tabled the request in June and still hadn't acted as of late August.
• San Marcos has several more proposals in the pipeline.
• Comal County has no data center proposals tracked so far.

Texas Just Hit the Brakes

This is the newest piece. In August, ERCOT paused new large data center grid hookups while it audits the projects already in line. On September 21, Gov. Abbott directed TCEQ to stop issuing permits to data center projects until those audits are done. No end date has been set.

What that means locally: projects still waiting on permits or grid approvals will probably slow down. It's not clear yet how much it affects projects already under construction.

What New Braunfels Is Doing About It

New Braunfels wants its rules on the books before anyone applies. In August 2026, City Council directed staff to update the development code so that data centers:

• Are defined as their own land use
• Are allowed only in industrial districts
• Need a special use permit
• Must meet standards for water use, noise and landscaping

Mayor Michael French put the reason plainly: unregulated data centers put "extraordinary demands on our Edwards Aquifer, our city's water systems and our local power grid." Council chose not to adopt a 90-day moratorium and went with permanent code changes instead. The new rules need two readings before they take effect.

City staff also pointed out that these facilities typically create only about 15 to 20 permanent local jobs compared with the resources they use.

What This Means If You're Buying or Selling

Inside city limits, you'll have more protection. Once the new rules are adopted, a data center can't just show up next to a neighborhood without going through a public permit process.

Outside city limits, look closer. Texas counties have limited control over land use, which is why tax incentives end up being their main leverage. If you're shopping for acreage or a home in unincorporated Guadalupe, Hays or Comal County, find out what's planned nearby before you fall in love with the view.

Questions worth asking on any property:

1. Is it inside city limits, in the ETJ, or in the county?
2. What's zoned or proposed within a few miles?
3. Who provides the water and power, and are there any pending rate changes?
4. Are there new transmission lines or gas lines planned in the area?

For homeowners near these sites: It's too early to say how property values will be affected, and anyone who tells you for sure is guessing. More traffic and construction in the short term is likely. A bigger tax base for schools over the long term is also real. The state pause and the lawsuit add even more uncertainty about timing.

The Bottom Line

AI infrastructure is coming to Central Texas, but it's moving slower now that the state is taking a harder look. The smartest move is to know where it's going and what the rules are before you buy. That's what I'm here for.

Thinking about buying or selling around New Braunfels, Seguin or San Marcos and want to know what's planned near a specific property? Reach out to Contact Corona and I'll dig into it for you.

Sources: Data Center Dynamics, Seguin Today, Community Impact, KSAT, San Marcos Record, CBS Austin, New Braunfels Herald-Zeitung, Greenberg Traurig, Holland & Knight. Information current as of October 2026.