Lack of Power Pushes Rental Increases in Major U.S. Data Center Markets: CBRE

Demand growth and shrinking availability of data centers are pushing companies to tertiary markets with greater power availability, a new report says.

Industry Dive

July 5, 2024

1 Min Read

Public cloud providers and AI companies are driving robust demand for data centers in North America, CBRE says. All four major markets studied in the report — northern Virginia, Chicago, Dallas-Fort Worth and Silicon Valley — had “major” year-over-year net absorption increases, led by northern Virginia, which saw a net absorption of 

As absorption rises, North American data center availability continues to become more restricted. Despite significant supply additions from the first quarter of 2023 to the first quarter of 2024, new inventory was rapidly filled, tightening the leasing market, per the report. Northern Virginia experienced the largest reduction in leasing availability, down 16.2 MW, followed by Chicago, which saw a 10.6 MW decrease, and Dallas, which dropped 1.5 MW. Silicon Valley was the only major market to see an increase, with availability rising 19 MW in that time frame.  

On the heels of high demand in North America, data center pricing is escalating rapidly. Averaging asking rates for a typical 250- to 500-kilowatt requirement surged 20% year over year across all four major U.S. markets, CBRE says...

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