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Data Center Supply Surges with AI and Digital Services Demand
North America’s data center sector doubled the amount of supply under construction in 2024 from the previous year to a record 6,350.1 megawatts (MW), a 12-fold increase from 2020, CBRE reported. The past year also saw operational capacity climb to 20 gigawatts, according to Cushman & Wakefield.
The surge highlights the growing need for data centers that can meet the power demands of artificial intelligence companies, according to CBRE’s latest North American Data Center Trend Report.
“We saw unprecedented demand last year in the North American data center market fueled in part by AI and digital services — which drive a need for modern data centers — and investment from hyperscalers and developers,” said Pat Lynch, executive managing director and global head of CBRE Data Center Solutions. “However, the risk of oversupply in the near term is minimal because of extended timelines for power delivery and wait times of 36 months or more for electrical equipment such as transformers, generators and switchgear.”
Although the eight primary North American data center markets saw a significant uptick in completed construction with a 34% year-over-year increase, according to CBRE, interest in large-scale power availabilities, plentiful land and less strict latency requirements for AI has driven hyperscalers and operators to expand into historically peripheral markets, Cushman & Wakefield reported. These include Indianapolis, Kansas City, Reno, Charlotte, Salt Lake City, Minneapolis, Philadelphia, Montgomery and other outlying areas.
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- ◦Development
