This question is highly related to this and this one.
Given a ring $A$ and an ideal $I$, the direct system of schemes $\text{Spec}(A/I)\rightarrow \text{Spec}(A/I^2)\rightarrow \ldots$ has a colimit if the category of qcqs-schemes and it is given by $\text{Spec}(\hat{A})$. Here $\hat{A}$ is just a completion of $A$ with respect to $I$. (A proof can be found here) Does this generalize to the non-affine case?
Given a closed sub-scheme $Z$ of $X$, there is the direct system of schemes $Z\rightarrow X_Z^{(1)}\rightarrow X_Z^{(2)}\rightarrow \ldots$. Here $X_Z^{(n)}$ is the $n$-th nilpotent thickening of $Z$ along $X$. Does this system has a colimit in the category of schemes? If so is it given by $\text{Spec}(\hat{A})$ on affine charts?
I am specifically interested in the case $X$ is a projective variety and $Z$ a hyper-surface section.
Edit: In the projective case, is $Proj(\hat{A})$ the colimit? Here $\hat{A}$ means that we just take the inverse limit of homogenous coordinate system and then take proj, very similar to the affine case.