"From Location and Power to Permitting and Finance, AI Data Centers Get One-Stop Solutions from 'One' Firm" [Law Firm Power Team]

Eight Partner Attorneys at Law Firm One
Combining Expertise in Construction, Finance, Tax, and Public Administration
Overseeing All Regulatory Aspects
Simplifying the Complexity of Data Centers

"AI data centers are no longer simply real estate development projects. They have become complex ventures where location, electricity supply, permitting, financing, international contracts, and tax policy must all align at the same time."

On July 22, Suh Soonseong, attorney at Law Firm One, described the changes in the AI data center market in an interview with The Asia Business Daily. Previously, as long as companies secured a site and attracted tenants such as global big tech firms, they could raise financing based on profitability. However, with the Seoul metropolitan area’s power grid now saturated and new requirements such as power system impact assessments in place, if a company does not confirm the availability of electricity first, it may end up owning a site but unable to even begin the project.

Seosoon Sung (left) and Inseon Ko, lawyers at One Law Firm, are posing for a photo. Photo by Dongju Yoon

Law Firm One has launched an AI Data Center Team in response to these changes. Centered around eight partner attorneys, they have combined expertise in construction, real estate, energy, finance, international transactions, tax, and public and administrative law. The firm also collaborates with external experts in areas such as appraisal, fire safety, disaster management, and AI data center infrastructure consulting. Their plan is to move away from the traditional segmented legal advisory approach and instead oversee the entire process, from site selection and securing power, to permits, contract and financial structuring, tax incentives, and regulatory issues during operation.

◆Securing Power Before Sites... Metro Area Faces Supply and Demand Mismatch

The most pressing issue for current operators is securing electricity. Demand for AI services is concentrated in the Seoul metropolitan area, but there it is not easy to secure new connections to the power grid. Conversely, outside the metropolitan area, it is relatively easy to secure power and land, but attracting tenants is much more difficult. Suh explained, "There is a mismatch: in metropolitan areas, there is demand but not enough sites and electricity; in the provinces, power and land are available but demand is lacking. If you acquire a site first and then the power supply is blocked, a huge amount of capital can be tied up."

The contractual framework also differs from standard real estate leases. Global hyperscale tenants require uninterrupted power supply, advanced cooling facilities, and physical and cyber-security standards. Often, the pace of advancements in graphic processing units (GPUs) and cooling technologies outpaces the construction period, requiring initial designs to be modified. As such, contracts must be structured with future changes and renegotiations in mind—including elements such as service level agreements (SLAs), the passing on of electricity costs, and priority negotiation rights for expansion.

◆Connecting Law, Technology, and Policy... "Turning Complexity into Simplicity"

Going forward, electricity regulations, region-specific electricity pricing, non-metropolitan special zones, and tax incentives are expected to be key factors determining business viability. Due to the facilities’ high power usage and heat output, compliance with fire and environmental regulations, as well as the Serious Accidents Punishment Act, will also be increasingly important.

Notably, it can take years from groundbreaking to completion for an AI data center, yet relevant technology and regulations change rapidly—meaning that potential changes must be incorporated into contracts and permitting strategies from the earliest stages. Law Firm One plans to continuously track the enactment of enforcement decrees and rules, special economic zone designations, and changes to energy policy to provide response strategies tailored to each stage of the project.

Ko Inseon, attorney at Law Firm One, emphasized, "Because data centers involve numerous government agencies and regulations and the technology evolves rapidly, understanding law, technology, and policy together is essential. Our team’s strength lies in leveraging our experience in government advisory and legislative and policy response, allowing us to also address public sector challenges." Ko added, "Our mission is to turn the complexity of data centers into simplicity. We will provide integrated solutions so clients can pursue the entire project process with stability, through a single point of contact."

This content was produced with the assistance of AI translation services.