Data Center Site Selection in Brazil

The Short Answer

Data center site selection in Brazil comes down to three questions, in this order. Can the site get a grid connection in a time a tenant will accept? Is the land rural or urban on paper? Can the water and environmental file survive public scrutiny? Price comes after those three.

Brazil is the largest data center market in Latin America. JLL counts 706 MW of installed capacity operating as of mid-2026, 660 MW under construction and 4,621 MW planned, with national vacancy at 4%. The grid is the limit: DCD Brasil reported in June 2026 that connection waits reach up to five years in some regions and that most new connections are expected after 2030.

For a landowner, the second question matters as much as the first. On April 23, 2026, Brazil's Supreme Court (STF) confirmed that Brazilian companies controlled by foreigners are treated as foreigners when they buy or lease rural land. Urban land carries no such limit. Most data center buyers are foreign-backed, so whether your property pays rural tax (ITR) or urban tax (IPTU) can decide whether they are able to buy it at all. This guide explains each step and ends with sections for landowners and brokers.

Why Brazil Is on the Data Center Map

Size. JLL's 706 MW is more than six times the 2012 level. São Paulo, meaning the capital and Barueri hub plus Campinas, holds 38% of the country's megawatts in JLL's count.

A second count that does not match. Cushman & Wakefield, as reported by DCD Brasil on September 24, 2026, puts the São Paulo–Campinas corridor alone at 661 MW operating in the first half of 2026 (up from 346 MW a year earlier), with 250 MW under construction, 2,066 MW planned and vacancy of 4.1%. That is hard to square with JLL's 706 MW for all of Brazil. JLL's figure is total installed capacity, and Cushman & Wakefield's method was not confirmed. The firms measure differently, so do not add or mix their numbers.

Operators. Forbes Brasil, citing JLL data, puts colocation market share at Ascenty 30%, ODATA 20%, Scala 18%, Equinix 9% and Elea 9%.

New regions. The largest single project is outside São Paulo. A campus for TikTok's parent ByteDance at Pecém, in Caucaia, Ceará, is being built by developer Omnia with wind generator Casa dos Ventos. The first phase is 200 MW of IT load. Construction began in January 2026 and operation is expected in the third quarter of 2027, according to Forbes Brasil. In Rio Grande do Sul, Scala Data Centers plans an "AI City" in Eldorado do Sul. BNamericas reported in July 2026 that construction is now expected to start in 2027, with a first 50 MW phase targeted for 2028, subject to permits.

What is scarce is land that can be connected, permitted and legally bought. For how developers rank candidate sites in general, see Data Center Site Selection and the Latin America overview.

Brazil at a Glance

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Power: The Grid Decides First

ONS (Operador Nacional do Sistema Elétrico) operates the national grid and runs access to the high-voltage transmission network, the rede básica. ANEEL is the regulator, the Ministry of Mines and Energy (MME) sets policy, and EPE does the planning studies a transmission connection requires.

The rules changed in December 2025. Decree 12,772 of December 5, 2025 created the National Transmission Access Policy, known as PNAST. It replaced the first-come-first-served queue with Temporadas de Acesso (access seasons) run by ONS, at least two a year. If a connection point has enough capacity, requests are approved directly. If demand is larger than capacity, a competitive process allocates it. According to law firm Tauil & Chequer (Mayer Brown), an existing parecer de acesso (the access opinion issued under the old rules) is not revalidated under PNAST, and there is no priority guarantee for future capacity.

The queue is large. Agência iNFRA reported that by February 2026 ONS had received 43 formal access requests from large consumers, 38 of them data centers totaling about 7,040 MW. That is an average of roughly 185 MW per request. São Paulo state had 20 of them, about 3,914 MW.

Guarantees are real money. In May 2026 ANEEL refused Scala's request for a waiver and required about R$77 million in guarantees before the company signs its transmission-use contracts, according to Convergência Digital. The formula per kilowatt was not found, so ask the buyer's energy counsel.

Timelines are long. The same June 2026 DCD Brasil report puts waits at up to five years in some regions, with most new connections after 2030. It reports Greater São Paulo as unavailable through 2030, Campinas at maximum capacity, Pecém with no capacity until 2031, and 25 data center requests denied in São Paulo state in 2024. These are conditions reported as of mid-2026.

In Brazil, "near a transmission line" is a location. Capacity is something a buyer has to win in an access season and back with a guarantee.

Self-production. EPE's 2026 national energy balance shows 86.8% of Brazil's electricity came from renewable sources in 2025, and large loads can contract their own generation. The TikTok project signed a 20-year, US$2 billion wind power agreement under an autoprodução (self-production) model, in which the consumer takes a stake in the generator, Forbes Brasil reported. Free-market eligibility rules were not verified for this guide, so confirm them with an energy lawyer.

For load sizing, see How Much Power Does a Data Center Need? and Powered Land for Data Centers.

Water: The Outorga and the Optics

Taking water from a river or well in Brazil requires an outorga, a water-use grant. According to the agencies' own descriptions, the National Water Agency (ANA) grants it for federal waters, and state agencies grant it for state waters and groundwater. In São Paulo the agency is SP Águas, formerly DAEE.

An outorga names a holder, a purpose and a volume. An irrigation grant held by a farmer is not industrial cooling water held by a data center company.

REDATA sets a ceiling. The new federal tax regime for data centers (see Incentives and Policy) requires a water-usage effectiveness (WUE) of no more than 0.05 liters per kWh, according to Mattos Filho. In practice that pushes projects toward closed-loop or air cooling.

Pecém shows the risk. The TikTok project in Caucaia was licensed by the state agency SEMACE as low impact, through a simplified report. Its declared water use rose from 19,700 liters a day in the preliminary license to 144,000 liters a day in the installation license, Focus Poder reported. In September 2026 federal prosecutors (MPF) and the federal public defender (DPU) filed a civil action seeking to block operation until there is new licensing and consultation of the Anacé indigenous people. For cooling options, see Data Center Water & Cooling.

Who Can Buy the Land: Foreign Ownership Rules

The law. Law 5,709/1971 restricts the purchase of rural land by foreign individuals, by foreign companies authorized to operate in Brazil, and, under article 1, paragraph 1, by Brazilian companies whose capital is majority-held by foreigners living or headquartered abroad.

The ruling. On April 23, 2026 the STF decided the question unanimously, according to Mayer Brown. Law 5,709/1971 remains fully valid. Brazilian companies controlled by foreigners are treated as foreigners. Registries in every state must apply it, and the court set no transition period.

What the law says, in plain terms:

• Foreign companies may acquire rural land only for approved projects. Article 5 lists agricultural, livestock, industrial or colonization projects.
• Size limits apply. A foreign individual may not exceed 50 módulos de exploração indefinida (MEI, an area unit that varies by municipality), and up to 3 módulos needs no authorization. Above 3, INCRA (the federal land agency) must authorize. The thresholds for companies were not confirmed on a primary source, so check them with counsel.
• Municipal caps apply. Foreign holdings may not exceed one quarter of a municipality's area, and one nationality may hold no more than 40% of that quarter (article 12).
• A public deed is mandatory (article 8), and the purchase goes into a special registry book.
• Non-compliant acquisitions are void (article 15).
• A lease does not get around it. Rural leases by foreigners carry the same limits under Law 8,629/1993, article 23, according to ZS Associados.

Border strip. Law 6,634/1979 defines a strip of 150 km along Brazil's land borders. There, a rural-land transaction that gives a foreigner ownership, possession or any real right needs prior assent of the national security council, and companies operating in the strip need at least 51% Brazilian capital.

Urban land is different. Urban property is unrestricted for foreigners, who need only a Brazilian tax number (CPF or CNPJ), according to ZS Associados. So a foreign-backed buyer's first question is whether your land is rural or urban.

A foreign-backed buyer needs from you: proof of urban status or a documented path to it, the area in módulos, how much of the municipality is already foreign-held, and the distance to the border. No law-firm source was found describing surface rights, built-to-suit leases or minority foreign stakes as tested structures for data centers on rural land, so leave structuring to the buyer's Brazilian counsel.

Land and Zoning: Rural or Urban Decides the Deal

Title. Ownership in Brazil is proven by the matrícula, the property's record at the Cartório de Registro de Imóveis (real estate registry office). Rural land also carries three more records: the CCIR (the INCRA rural property certificate), the CAR (the rural environmental registry) and the ITR (the federal rural land tax).

Rural or urban. Rural status turns on location outside the municipal urban perimeter or on agricultural use. The quick test is the tax bill: ITR means rural, and IPTU (the municipal urban property tax) means urban. Zoning itself is municipal, set by the plano diretor (master plan) and the land-use law.

The conversion path. Turning rural land into urban land is called descaracterização. Under INCRA Normative Instruction 82/2015, as explained by VLF Advogados, INCRA looks at two things: location inside the urban perimeter defined by municipal law, and actual urban use. The owner files a municipal certificate, INCRA cancels the CCIR, and the change is recorded (averbação) on the matrícula. A rezoning promise is not enough.

A real example. In December 2024 the municipality of Eldorado do Sul, in Rio Grande do Sul, passed a law expanding its urban perimeter to take in the former eucalyptus plantation that Scala had bought for its AI City, as Intercept Brasil reported. The municipal law comes first, then the INCRA and registry steps.

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Environmental set-asides. Rural properties must keep a reserva legal (a legal forest reserve) and permanent preservation areas (APP) along watercourses, springs and slopes under the Forest Code, Law 12,651/2012. The commonly cited percentages vary by region and were not verified here, so have counsel confirm how much of your land is buildable. For general sizing, see Data Center Land Requirements.

Permits: Environmental License and Municipal Zoning

One level of government licenses a project under Complementary Law 140/2011. In practice that is usually the state environmental agency: CETESB in São Paulo, SEMACE in Ceará, FEPAM in Rio Grande do Sul. Where delegated, it is the municipality.

The classic process, as CETESB describes it, has three stages: the preliminary license (Licença Prévia, LP), the installation license (Licença de Instalação, LI) and the operating license (Licença de Operação, LO).

The General Environmental Licensing Law, Law 15,190/2025, has been in force since February 4, 2026. It allows simplified single-phase licenses for low-impact activities. In São Paulo, the "license by commitment" was still waiting for CETESB rules as of July 2026, according to Grupo Carbono. The municipal land-use certificate is no longer a prerequisite for the state license. Zoning compliance is still mandatory.

Simplified does not mean safe. No national threshold was found that says when a data center needs a full environmental impact study (EIA/RIMA). Both flagship projects were licensed through simplified studies, and both are being contested for that. Rio Grande do Sul adopted data-center-specific licensing rules in May 2025, described by Matinal as the first in Brazil. High-voltage lines serving a project are commonly cited as triggering a full study; that was not verified, so confirm with counsel.

Timelines. No reliable figure in months was found. One indicator: Eldorado do Sul changed its urban perimeter for Scala's site in December 2024, and construction is now expected to start in 2027. Plan in years.

Where in Brazil: São Paulo, Campinas, Ceará and Rio Grande do Sul

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The Northeast has a specific pull: surplus wind and solar. Of the 2,843 MW of wind and solar output cut on average from January 30 to April 30, 2026, the Northeast accounted for 2,233 MW, according to Canal Solar. Whether a site can use that surplus depends on transmission access, which brings the question back to ONS. Outside these markets, a site needs a specific reason to exist, such as confirmed grid capacity or a self-production partner. For fiber, see Data Center Fiber & Connectivity.

Incentives and Policy: REDATA Is Now Law

This changed within the last few weeks. REDATA, the special tax regime for data centers, started as Provisional Measure 1,318/2025, published September 18, 2025. Congress did not convert it, and it lapsed on February 25, 2026. A new bill, PL 278/2026, passed the Senate on September 1, 2026 and became Law 15,504/2026, published on September 15, 2026 with no vetoes.

What it does. According to Mattos Filho, the law suspends the federal taxes PIS/COFINS and IPI on domestic purchases of information-technology equipment for a data center's fixed assets. It also suspends PIS/COFINS-Import, IPI and Import Tax on imported equipment that has no domestic equivalent. The suspension can convert to a zero rate when the conditions are met.

The conditions:

• 100% renewable or low-emission electricity
• Water-usage effectiveness of no more than 0.05 L/kWh
• Research and development investment of 2% of the value of the products acquired
• 10% of capacity offered to the domestic market, or an extra R&D contribution instead
• Tax compliance

Projects in the North, Northeast and Center-West get a 20% reduction in these obligations, so the R&D figure becomes 1.6%.

The time limit. The benefit period is five years, but Mattos Filho reports that the PIS/COFINS and IPI benefits end on December 31, 2026 because of the transition to Brazil's tax reform. The list of covered products still depends on rules from the Executive. As of October 2026, treat REDATA as real but narrow.

State tax is not covered. REDATA does not touch ICMS, the state value-added tax. Telesíntese reported that a proposal at Confaz (the council of state finance secretaries) to cut ICMS on data center equipment by up to 90% was scheduled for a vote on September 4, 2026, with São Paulo reluctant and Northeast states more favorable. Trade press then reported the decision was postponed. The final outcome was not found as of early October 2026.

Community and Political Risk

Pecém, Ceará. The Anacé people say they learned of the TikTok project from the press. The September 2026 civil action by MPF and DPU seeks to stop operation until there is new licensing and consultation.

Eldorado do Sul. Critics point to simplified licensing with no full impact study and no public hearing, to grid load (the full build would exceed the state's current consumption, Matinal reports), and to Mbyá-Guarani communities within 2.5 km who say they were not consulted.

Grid and land scrutiny. Abrace, the association of large industrial energy consumers, objects that data center requests of 200–300 MW crowd out manufacturers. In Uberlândia, Intercept Brasil reported that a data center site is tied to a fund under federal investigation.

No moratorium was found as of October 2026. The direction is toward more rules: Conama, the national environmental council, passed Motion 147/2026 calling for national data center guidelines, and a Senate committee discussed a regulation bill in August 2026. A site with consulted neighbors, a low-water design and a full environmental file will close faster than one that ends up in court.

Three Scenarios with the Math

These examples are illustrative. Figures marked as assumptions are chosen to show how the math works; they are not market quotes or appraisals. Published land-price signals are thin. Only two were found: Scala's purchase in Eldorado do Sul and a contested appraisal in Uberlândia. No published benchmark for powered land in the São Paulo hubs was found.

Eight Mistakes Landowners and Brokers Make

1. Pitching land without a power answer. Greater São Paulo is reported unavailable through 2030 and Pecém until 2031. "Near a line" is not capacity.
2. Treating an old parecer de acesso as an asset. PNAST does not revalidate access opinions issued under the old rules and gives no priority for future capacity.
3. Offering rural land to a foreign-controlled buyer as is. The STF confirmed in April 2026 that foreign-controlled Brazilian companies face the Law 5,709/1971 limits, and non-compliant deals are void. A lease does not fix it.
4. Assuming rezoning is paperwork. INCRA needs both urban-perimeter location and urban use, plus CCIR cancellation and a registry annotation. Eldorado do Sul needed a municipal law.
5. Selling water rights with the land. The outorga names a holder, a purpose and a volume, and its transferability is not confirmed. Pecém shows how a revised water figure becomes a lawsuit.
6. Ignoring the neighbors. Both flagship projects face prior-consultation challenges under ILO Convention 169 and criticism over simplified licensing.
7. Pricing from headlines. The Uberlândia appraisal went from a R$14 million purchase to R$76 million after an announcement and is under investigation. Scala paid about R$10.9/m², and no published benchmark for powered land in the São Paulo hubs was found.
8. Brokering without CRECI, or with no written fee agreement. Unregistered intermediation is treated as a misdemeanor, and commentators hold that the commission may be unenforceable.

What to Send: The Buyer's Checklist

A serious buyer will ask for these early.

1. Matrícula atualizada (current registry record) from the Cartório de Registro de Imóveis, showing chain of title and any liens.
2. ITR or IPTU (rural or urban tax status). If the land was rural, send the municipal law placing it in the urban perimeter and proof that the CCIR was cancelled and the change annotated.
3. CCIR and CAR (INCRA rural certificate and rural environmental registry) for rural land, with recent ITR receipts.
4. Georreferenciamento / SIGEF (georeferenced survey, certified in INCRA's system if available). The mandatory deadline is now October 21, 2029, but buyers will want it.
5. Foreign-buyer facts: area in módulos (MEI), how much of the municipality is already foreign-held, and distance from the border (the 150 km strip).
6. Power: distance to the nearest substation and transmission line, the voltage class (138, 230, 345, 440 or 500 kV), the utility or transmission owner, and any ONS or distributor access document.
7. Outorga (water-use grant), if any: holder, purpose, volume, expiry and the granting agency. Do not describe it as transferable.
8. Environmental file: reserva legal and APP as mapped on the CAR, existing licenses, and distance to indigenous or quilombola lands and conservation units.
9. Zoning: the plano diretor classification and a certidão de uso do solo (municipal land-use certificate) where available.
10. Certidões negativas (clearance certificates) for the owner covering tax, labor and civil suits.

For Landowners in Brazil

For Brokers in Brazil

Real estate brokerage in Brazil is a regulated profession. Law 6,530/1978 governs the corretor de imóveis, who must be registered with CRECI, the regional council, under COFECI rules. Brokering without registration is treated as a misdemeanor under Decree-Law 3,688/1941, article 47, although legal commentators note that case law is divided on how it applies.

The research for this guide found no provision that lets a foreign-licensed broker act in Brazil without CRECI registration. So Carson works in Brazil only through a written referral or partnership agreement with a CRECI-registered corretor or imobiliária (brokerage firm), who performs the intermediation. No specific COFECI rule on cross-border referral fees was found, so the fee arrangement should be confirmed with CRECI/COFECI or counsel before it is signed. For reference, Guia do Corretor lists CRECI table rates of 6–8% for urban property, 8–10% for rural property and 6–8% for land and lots, with a typical 50/50 split between listing and selling sides. The tables are not mandatory.

Frequently Asked Questions

Sources

1. JLL — Brazil Data Center Report shows record growth in 2026 (2026)
2. Forbes Brasil — Onde Estão os Data Centers do Brasil e Quem os Controla (Aug 2026)
3. DCD Brasil — Cushman & Wakefield indica que capacidade de data centers cresce 91% em um ano em São Paulo (Sep 24, 2026)
4. Forbes Brasil — Omnia e Casa dos Ventos Assinam Acordo de Energia de US$ 2 Bi para data center do TikTok (May 18, 2026)
5. Focus Poder — Data center do TikTok em Pecém vira alvo de ação do MPF e da DPU (Sep 14, 2026)
6. CIMI — Povo Anacé denuncia violações de direitos (Sep 17, 2026)
7. BNamericas — Scala Data Centers now sees Brazil AI City ready by 2028 (Jul 2, 2026)
8. Matinal / Ambiental Media — Maior data center da América do Sul terá licenciamento simplificado no RS (Mar 23, 2026)
9. Intercept Brasil — Preço de terreno ligado ao Master supervaloriza após anúncio de data center em Minas Gerais (Jul 13, 2026)
10. Agência iNFRA — ONS recebe 43 pedidos de acesso à Rede Básica, maioria de data centers (Feb 4, 2026)
11. Tauil & Chequer / Mayer Brown — Governo cria nova política para organizar o acesso ao sistema de transmissão (Dec 17, 2025)
12. DCD Brasil — Alta demanda por conexão no grid tem espera de até 5 anos (Jun 22, 2026)
13. Convergência Digital — Aneel rejeita pedido da Scala e exige garantias financeiras para data center em Eldorado do Sul (May 21, 2026)
14. EPE — EPE publica o Relatório Síntese do Balanço Energético Nacional 2026 (Jun 3, 2026)
15. Canal Solar — Brasil já cortou quase 3 GW médios de energia solar e eólica em 2026 (May 18, 2026)
16. Mattos Filho — Brazil's new data center tax incentives regime signed into law (Sep 2026)
17. Câmara dos Deputados — Nova lei cria incentivo fiscal para instalação de datacenters no Brasil (Sep 15, 2026)
18. Telesíntese — Após Redata, setor pressiona Confaz por redução de ICMS para data centers (Sep 2, 2026)
19. Conjur — Brasil regula os data centers aos pedaços (Aug 20, 2026)
20. Intercept Brasil — Eldorado do Sul abre portas para projeto bilionário de data center (Jun 23, 2025)
21. Planalto — Lei 5.709/1971, rural land acquisition by foreigners (Oct 7, 1971)
22. ZS Associados — Urban vs. Rural Property for Foreigners in Brazil (2026)
23. Mayer Brown — STF mantém, por unanimidade, o regime restritivo da Lei 5.709/1971 (Apr 27, 2026)
24. Planalto — Lei 6.634/1979, border strip (May 2, 1979)
25. VLF Advogados — A descaracterização de imóvel rural sob a ótica do INCRA (n/d)
26. Demarest — Exigências do georreferenciamento de imóveis rurais na atualidade (Jan 6, 2026)
27. Grupo Carbono — Atualizações no licenciamento ambiental CETESB: o que mudou? (Jul 27, 2026)
28. Planalto — Lei 6.530/1978, profession of corretor de imóveis (May 12, 1978)
29. Conteúdo Jurídico — Exercício ilegal da profissão de corretor de imóveis (Aug 24, 2021)
30. Guia do Corretor — Comissão do Corretor de Imóveis: Quanto Cobrar em 2026 (Aug 30, 2026)

Related guides

Data Center Site Selection in Latin America · Mexico · Chile · Colombia · Data Centers: The Complete Guide · Data Center Site Selection · Data Center Land Requirements · How Much Power Does a Data Center Need? · Powered Land for Data Centers · Water & Cooling · Fiber & Connectivity

Educational information only — not legal, tax, engineering, or investment advice. Brazil land, water, energy, and brokerage rules change frequently; confirm every point with local counsel, a locally authorized broker, and the relevant authorities before acting. Carson Jones is licensed in Tennessee and does not practice real estate brokerage in Brazil; transactions there are handled by locally authorized brokers under written co-brokerage or referral agreements. Scenario figures are illustrative, not quotes or appraisals.

Carson Jones

Founder · Passive Investments · eXp Commercial

Carson Jones is the host of Carson's Corner: Commercial Real Estate, author of The Red Flag Playbook, a licensed commercial real estate advisor and business broker, and the founder of Passive Investments. With 18 years of experience as an entrepreneur and 12 years specializing in passive investing, Carson works with high-net-worth individuals, family offices, business owners, and sophisticated investors as a broker, principal, and capital partner.

Carson holds a BBA in Finance from Baylor University and his Tennessee commercial real estate license (#382989). He actively pursues acquisition and equity opportunities across the United States through a nationwide network of qualified buyers, family offices, institutional investors, and top-tier developers.

Phone 615-212-5524

Email carson@passive.investments

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