Soluna Holdings and Applied Digital want to build a 50 MW data center for artificial intelligence in the Texas Panhandle. A third company, ChronoScale Holdings, already intends to lease it.
The two Nasdaq-listed firms announced the plan on October 21, 2026.
How the deal is structured
Soluna (Nasdaq: SLNH) and Applied Digital (Nasdaq: APLD) plan to form a jointly owned project company. That entity would develop a 50 MW facility built for AI and high-performance computing, or HPC.
The project is called Project Dorothy 3, located in Briscoe County, Texas. It would draw renewable power from the neighboring 150 MW Briscoe Wind Farm, with the electrical grid as an additional source.
The ownership split is close to even, but not quite. Applied Digital would hold a 51% interest and manage the venture. Soluna would contribute land and related power assets in exchange for a 49% stake.
The tenant, and the fine print
ChronoScale Holdings Corporation has signed a non-binding letter of intent for a triple-net lease on the facility. Under a triple-net structure, the tenant typically covers property taxes, insurance and maintenance on top of rent.
There is a notable wrinkle. ChronoScale is majority-owned by Applied Digital, so the company holding 51% of the project is also the parent of the intended tenant.
The letter of intent is also explicitly non-binding. The final lease still has to be negotiated.
Several other conditions must be met before the transaction closes. These include tax abatement approval from Briscoe County, organizational approvals, and finalized operating agreements.
The companies are targeting a close by December 31, 2026.
Building on the Dorothy campuses
This is not Soluna’s first project in the area. Its Dorothy 1 campus is already operational with 50 MW of capacity, and the company has pursued vertical integration efforts there.
Soluna has also been assembling the pieces that make Dorothy 3 possible. It acquired the Briscoe Wind Farm, and in August 2026 it bought 397 acres that this partnership now builds on.
The location also places the project within the Electric Reliability Council of Texas, known as ERCOT.
What this means for both companies
For Soluna, the deal converts land and power assets into a 49% stake in an AI facility with a tenant in view.
For Applied Digital, the appeal is access to a site that already has a 150 MW wind generation source adjacent to the land, along with grid access.
For shareholders in SLNH and APLD, the near-term items to watch are the Briscoe County tax abatement decision, the signed operating agreement and a binding lease with ChronoScale.
Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.