Data Bytes: CBRE Sees 373 Megawatts of Data Center Construction for 2021

Nov. 16, 2020
More than 373 megawatts of new wholesale data center construction is underway across major markets in the United States, according to a newly-published 2021 market outlook from CBRE.

Data Bytes is a weekly roundup of research and analysis for the data center and cloud computing sector.  Want to get it in your Inbox every Monday? Sign up for our DCF news updates

More than 373 megawatts of new wholesale data center construction is underway across major markets in the United States, according to a newly-published 2021 market outlook from CBRE. The real estate firm forecasts that total data center inventory will grow by 13.8% in 2021.

“Continued adoption of hybrid information technology (IT) and cloud services, the growth of artificial intelligence (AI) technologies and an ability to support a dispersed workforce will drive industry growth over the next several years,” said CBRE.

The largest market is Northern Virginia, which has nearly 1.3 gigawatts (GWs) of data center capacity, and is also one of the busiest development markets. Here’s a look at how CBRE estimates the inventory and space under development in leading markets:

The top data center markets in North America, according to CBRE.

In 2020, data center demand has been driven by the hyperscale data center operators, led by Google, Microsoft, Amazon Web Services and Facebook. These companies were strong acquirers of leased data center space in 2020 due to the societal shift to online activity during the COID-19 pandemic. As service providers scramble to keep pace with hyperscale demand, they say enterprise customers are cautious about short-term needs as they manage through the pandemic. The impact on the providers has been limited thus far, and analysts see a silver lining within the enterprise buying slowdown, as the pandemic accelerates business automation projects for the “next normal.”

“Hyperscale activity likely will level out in 2021 as demand drivers that spiked in 2020 begin to plateau, including enterprise clients leveraging hybrid IT solutions to accommodate remote working mandates,” said CBRE. “This trend likely will continue, albeit at a slower pace than in 2020.”

Sustainability will be a key narrative in the growth of second-tier markets in 2021.

“As data center technology evolves and allows for more power-dense facilities, many providers are looking to expand in markets that offer affordable clean energy,” CBRE said in its forecast. “Smaller, secondary markets that couple clean low-cost energy, advantageous tax incentives, affordable land prices and network connectivity are poised to see the most growth. Montreal and Hillsboro (Portland), OR, provide hydroelectric power at rates well below those in other markets.”

About the Author

Rich Miller

I write about the places where the Internet lives, telling the story of data centers and the people who build them. I founded Data Center Knowledge, the data center industry's leading news site. Now I'm exploring the future of cloud computing at Data Center Frontier.

Sponsored Recommendations

The AI Disruption: Challenges and Guidance for Data Center Design

From large training clusters to small edge inference servers, AI is becoming a larger percentage of data center workloads. Learn more.

A better approach to boost data center capacity – Supply capacity agreements

Explore a transformative approach to data center capacity planning with insights on supply capacity agreements, addressing the impact of COVID-19, the AI race, and the evolving...

How Modernizing Aging Data Center Infrastructure Improves Sustainability

Explore the path to improved sustainability in data centers by modernizing aging infrastructure, uncovering challenges, three effective approaches, and specific examples outlined...

How Modern DCIM Helps Multi-Tenant Colocation Data Centers Be More Competitive

Discover the transformative impact of modern DCIM software on multi-tenant colocation data centers, enhancing competitiveness through improved resiliency, security, environmental...

Yentafern/Shutterstock.com

Cooling the AI Revolution in Data Centers

Nathan Blom of Iceotope Technologies explains that by aligning liquid cooling strategies with broader business objectives, organizations can accelerate innovation, improve cost...

White Papers

Get the full report.

Why You Need to Accelerate Your Business with Cloud

Oct. 18, 2022
In this white paper, Cologix explores how data centers can help businesses use the cloud to stay ahead of their digital transformation needs.