### Data Center Supply Surges with AI and Digital Services Demand
The data center sector in North America has seen unprecedented growth, with supply under construction doubling in 2024 compared to the previous year, reaching a record 6,350.1 megawatts (MW), according to CBRE. This marks a 12-fold increase from 2020. Operational capacity also climbed to 20 gigawatts over the past year, as reported by Cushman & Wakefield.
This surge reflects the increasing demand for data centers capable of meeting the power needs of artificial intelligence companies, as highlighted in 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.”
While the eight primary North American data center markets experienced a 34% year-over-year increase in completed construction, interest in large-scale power availability, ample land, and less restrictive latency requirements for AI has driven hyperscalers and operators to expand into historically peripheral markets. According to Cushman & Wakefield, these emerging markets include Indianapolis, Kansas City, Reno, Charlotte, Salt Lake City, Minneapolis, Philadelphia, Montgomery, and other outlying areas.
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This article originally appeared on Connect CRE.
