The Data Center Construction Market was valued at USD 61.84 billion in 2023, and is expected to reach USD 113.62 billion by 2029, rising at a CAGR of 10.67%.
KEY TRENDS & ENABLERS
- The convergence of sustainability, 5G, cloud adoption, and government support underscores a global push toward connectivity and innovation as data centers evolve to meet the demands of an increasingly interconnected world.
- Globally, data centers are shifting towards renewable energy sources, reflecting a commitment to sustainability and reducing carbon emissions. The International Energy Agency (IEA) predicts data centers will consume 8% of global energy by 2030.
- The deployment of 5G networks drives the demand for edge data centers, enabling low-latency services and real-time decision-making across industries and supporting the data center construction market growth.
- Governments worldwide offer tax incentives and policies to attract data center investments. For instance, European governments prioritize compliance with regulations like GDPR and provide incentives for green initiatives to attract data center projects.
SEGMENTATION INSIGHTS
The global data center construction market showcases a dynamic landscape with distinct regional trends and priorities. In North America, the emphasis is on the adoption of modular power infrastructure, driven by their cost-saving benefits and efficiency improvements. Power supply companies such as Dominion Energy and NOVEC respond to increasing demand by developing their substations. Furthermore, a notable shift toward real-time monitoring software with AI features enhances predictive maintenance and ensures uninterrupted operations. Sustainability remains a key focus, with innovations in power and cooling systems aimed at reducing environmental impact.
Western Europe emphasizes the adoption of modular power infrastructure and the importance of monitoring, automation, and AI in ensuring operational efficiency. The region also anticipates the adoption of innovative cooling techniques and designs, such as district heating, aligning with sustainability goals. Furthermore, in Central and Eastern Europe, the focus on modular power infrastructure continues, along with the integration of intelligent monitoring systems. Notable advancements in cooling systems, fire safety technologies, and district heating designs reflect the region's commitment to efficiency and sustainability. The highest CAGR among all regions suggests a rapidly growing market, potentially fueled by increased digitalization efforts and infrastructure development initiatives. Also, Nordic countries stand out for their extensive use of renewable energy sources and innovative cooling techniques, such as free cooling methods leveraging colder climates. Adopting microgrids and on-site power generation systems underscores the region's energy efficiency and sustainability commitment. Additionally, integrating intelligent controls and adherence to industry standards such as ASHRAE guidelines and Uptime Institute's tier standards highlight the evolution of data center design toward greater efficiency and reliability.
In the Middle East, where harsh climatic conditions pose challenges, there is a focus on cooling systems and sustainable power sources such as EcoDiesel and natural gas. Ensuring physical security and fire safety remains vital for uninterrupted operations. Africa witnesses a surge in data center construction, particularly in Tier III and IV facilities, with a strong emphasis on reliability and operational excellence. Adoption of adiabatic cooling and adherence to industry guidelines reflect efforts toward efficiency and sustainability.
The APAC region observes a significant expansion of colocation and hyperscale data centers driven by investments and technological advances. Due to elevated temperatures and water scarcity challenges, air-based cooling methods are favored, with a growing focus on free-cooling chillers for partial cooling. Furthermore, while regions such as Latin America, Africa, and APAC exhibit substantial growth, they face economic volatility, political instability, and infrastructure limitations.
Strongest Growing Region
North America has emerged as the strongest growing region in terms of cumulative investment in the data center construction market from 2020 to 2029. With a cumulative investment of USD 248 billion between 2024 and 2029, North America showcases consistent growth across all segments - electrical infrastructure, mechanical infrastructure, and general construction.
Emerging Region
Central & Eastern Europe stands out as the emerging global data center construction market region. Despite having lower initial investments than other regions, it demonstrates a remarkable CAGR in almost all segments, indicating increasing adoption and investment in data center infrastructure.
SEGMENTATION ANALYSIS
Segmentation by Facility Type
- Hyperscale Data Centers
- Colocation Data Centers
- Enterprise Data Centers
Segmentation by Infrastructure
- Electrical Infrastructure
- Mechanical Infrastructure
- General Construction
Segmentation by Electrical Infrastructure
- UPS Systems
- Generators
- Transfer Switches & Switchgears
- PDUs
- Other Electrical Infrastructure
Segmentation by Mechanical Infrastructure
- Cooling Systems
- Racks
- Other Mechanical Infrastructure
Segmentation by Cooling Systems
- CRAC & CRAH Units
- Chiller Units
- Cooling Towers, Condensers, & Dry Coolers
- Economizers & Evaporative Coolers
- Other Cooling Units
Segmentation by Cooling Technique
- Air-based Cooling
- Liquid-based Cooling
Segmentation by General Construction
- Core & Shell Development
- Installation & Commissioning Services
- Engineering & Building Design
- Fire Detection & Suppression
- Physical Security
- DCIM/BMS Solutions
Segmentation by Tier Standards
- Tier I & Tier II
- Tier III
- Tier IV
GEOGRAPHICAL ANALYSIS
- Regarding investment, the North American region leads the global data center construction market with consistent yearly growth. From 2020 to 2029, North America has been witnessing a significant increase in investment, with a CAGR of 11.75%. North America, particularly North Virginia, is the epitome of data center development, boasting the highest concentration of facilities globally. Locations such as Loudoun County in Virginia, Texas, California, Arizona, Illinois, Georgia, Oregon, and New York/New Jersey are the key hotspots, attracting major colocation and hyperscale operators. Strong connectivity, renewable energy options, and tax incentives contribute to their appeal. While North Virginia leads, other regions such as Texas, Arizona, and Georgia are witnessing significant growth, driven by hyperscale demand and favorable business environments.
- While North America remains the dominant player in terms of investment, the APAC region emerges as a key emerging data center construction market, experiencing substantial growth in investment during the forecast period. With a CAGR of 10.28%, APAC showcases robust development driven by countries such as China, India, and Singapore. Adopting artificial intelligence (AI) and increasing investments from data center operators contribute to the region's growth trajectory. Additionally, Southeast Asian countries such as Malaysia and Indonesia stand out as significant investors, with anticipated acceleration in investments in the coming years.
- In terms of area and power capacity, North America maintains its lead in the data center construction market, showcasing steady growth, while other regions such as Latin America, Europe, the Middle East, and Africa demonstrate noteworthy expansion. Latin America, for instance, shows promising growth in terms of area and power capacity, indicating a rising demand for data center infrastructure in the region. Similarly, the Middle East and Africa witness substantial growth in power capacity, driven by investments in smart cities, sustainable energy resources, and government initiatives.
Segmentation by Geography
- North America The U.S. Canada
- Latin America Brazil Chile Colombia Mexico Argentina Rest of Latin America
- Western Europe The U.K. Germany France Netherlands Ireland Switzerland Italy Spain Belgium Portugal
- Other Western European Countries Nordics Denmark Norway Sweden Finland Iceland
- Central & Eastern Europe Russia Poland Austria Czechia Other Central & Eastern European Countries
- Middle East UAE Saudi Arabia Israel Oman Qatar Kuwait Jordan Bahrain Other Middle East Countries
- Africa South Africa Kenya Nigeria Egypt Ethiopia Other African Countries
- APAC China Hong Kong Australia New Zealand Japan India South Korea Taiwan Rest of APAC
- Southeast Asia Singapore Indonesia Malaysia Thailand Philippines Vietnam Other Southeast Asia Countries
VENDOR LANDSCAPE
- The global data center construction market is experiencing robust growth across different regions, driven by escalating demand for data infrastructure and services.
- In North America, prominent construction contractors such as AECOM, Arup, and Jacobs Turner Construction are capitalizing on the burgeoning data center construction market, supported by the expansion efforts of major colocation operators such as Equinix, Digital Realty, and CyrusOne. In addition, hyperscale giants such as Amazon Web Services (AWS) and Microsoft are aggressively expanding their footprint, particularly in regions such as Northern Virginia and Texas, stimulating further construction activity. New entrants such as Corscale Data Centers and Skybox Datacenters are also making significant strides, intensifying competition and fostering innovation in the data center construction market.
- Latin America presents a dynamic landscape with established players and emerging contenders. Construction contractors such as AECOM and Afonso Fran?a Engenharia are the leading key projects, while colocation operators such as Ascenty and ODATA (Aligned Data Centers) are spearheading the development of multiple data center facilities. Supporting infrastructure vendors such as ABB and Vertiv is crucial to facilitating construction activities and ensuring efficient regional operations. The entry of new players, such as Layer 9 Data Centers and CloudHQ, further enriches the competitive environment, signaling market disruption and expansion opportunities.
Key Data Center Support Infrastructure Providers
- ABB
- Caterpillar
- Cummins
- Delta Electronics
- Eaton
- Legrand
- Rolls-Royce
- Schneider Electric
- STULZ
- Vertiv
Other Data Center Support Infrastructure Providers
- 3M
- Airedale
- Alfa Laval
- Asetek
- Assa Abloy
- Bloom Energy
- Carrier
- Condair
- Cormant
- Cyber Power Systems
- Daikin Applied
- Enlogic
- FNT Software
- Generac Power Systems
- Green Revolution Cooling (GRC)
- HITEC Power Protection
- Honeywell
- Johnson Controls
- KOHLER
- KyotoCooling
- Mitsubishi Electric
- Munters
- Natron Energy
- NetZoom
- Nlyte Software
- Panduit
- Piller Power Systems
- Rittal
- Siemens
- Trane (Ingersoll Rand)
- Tripp Lite
- Yanmar (HIMOINSA)
- ZincFive
Key Data Center Contractors
- AECOM
- Arup
- Corgan
- DPR Construction
- Fortis Construction
- Holder Construction
- Jacobs
- Mercury
- Red Engineering
- Rogers-O’Brien Construction
- Syska Hennessy Group
- Turner Construction
- Turner & Townsend
Other Data Center Contractors
- AlfaTech
- Atkins
- Aurecon
- Basler & Hofmann
- Black & Veatch
- BlueScope Construction
- Brasfield & Gorrie
- CallisonRTKL
- Cap Ingelec
- Clark Construction Group
- Climatec
- Clune Construction
- COWI
- DC PRO Engineering
- Dornan
- Edarat Group
- Ehvert
- EMCOR Group
- EllisDon
- EYP MCF
- Gensler
- Fluor Corporation
- Gilbane Building Company
- HDR
- HITT Contracting
- Hoffman Construction
- ISG
- JE Dunn Construction
- Kirby Group Engineering
- kW Engineering
- Laing O’Rourke
- Linesight
- M+W Group (Exyte)
- McLaren Construction Group
- Morrison Hershfield
- Mortenson
- PM Group
- Quark
- Rosendin
- Royal HaskoningDHV
- Salute Mission Critical
- Sheehan Nagle Hartray Architects
- Skanska
- Southland Industries
- Sturgeon Electric Company
- Structure Tone
- Sweco
- The Mulhern Group
- The Walsh Group
- The Weitz Company
- TRINITY Group Construction
- Urbacon
Key Data Center Operators
- 21Vianet Group (VNET)
- Amazon Web Services
- Apple
- China Telecom
- Colt Data Centre Services
- CyrusOne
- Digital Realty
- Equinix
- GDS Services
- Global Switch
- Google
- Iron Mountain
- Meta (Facebook)
- Microsoft
- NTT Global Data Centers
- QTS Realty Trust
- STACK Infrastructure
- ST Telemedia Global Data Centres
- Vantage Data Centers
Other Data Center Operators
- 3data
- AdaniConneX
- Africa Data Centres
- AirTrunk
- Aligned Data Centers
- American Tower
- AQ Compute
- Aruba
- Ascenty
- AtlasEdge
- atNorth
- AT TOKYO
- Big Data Exchange
- Bulk Infrastructure
- CDC Data Centres
- Chayora
- China Mobile
- Chindata
- CloudHQ
- Cologix
- Compass Datacenters
- COPT Data Center Solutions
- CtrlS Datacenters
- Cyxtera Technologies
- Data4
- DataBank
- DC BLOX
- Digital Edge DC
- Digital Parks Africa
- Echelon Data Centres
- EdgeConneX
- Edge Centres
- EdgeUno
- Element Critical
- ePLDT
- eStruxture Data Centers
- fifteenfortyseven Critical Systems Realty (1547)
- Flexential
- Green Mountain
- Gulf Data Hub
- H5 Data Centers
- HostDime
- Huawei Technologies
- IXcellerate
- Hyperco
- KDDI (Telehouse)
- Keppel Data Centres
- Khazna Data Centers
- LG Uplus
- maincubes one
- MainOne (Equinix)
- Milicom (Tigo)
- Nabiax
- Nautilus Data Technologies
- NEXTDC
- NTT DATA
- ODATA
- Open Access Data Centres
- Orange Business Services
- OVHcloud
- Pi Datacenters
- Prime Data Centers
- PowerHouse Data Centers
- Princeton Digital Group
- Proximity Data Centres
- Pure Data Centres Group
- QTS Realty Trust
- Raxio Data Centres
- Rostelecom Data Centers
- Sabey Data Centers
- Scala Data Centers
- Sify Technologies
- Skybox Datacenters
- SpaceDC
- Stream Data Centers
- SUNeVision (iAdvantage)
- Switch
- T5 Data Centers
- Tenglong Holdings Group
- Teraco (Digital Realty)
- Telecom Italia Sparkle
- TierPoint
- TONOMUS (ZeroPoint DC)
- Turkcell
- Urbacon Data Centre Solutions
- VNET
- Wingu
- YTL Data Center
- Yondr
- Yotta Infrastructure Solutions
New Entrants
- Agility
- AUBix
- Cloudoon
- ClusterPower
- Corscale Data Centers
- Crane Data Centers
- Damac Data Centres (EDGNEX)
- Data Center First
- DHAmericas
- Edged Energy
- Evolution Data Centres
- Form8tion Data Centers (Thor Equities)
- Gatineau Data Hub (GDH)
- Gaw Capital
- Global Technical Realty
- Goodman
- Kasi Cloud
- Layer 9 Data Centers
- Quantum Loophole
- Quantum Switch Tamasuk (QST)
- Regal Orion
- Rowan Digital Infrastructure
- Stratus DC Management
- Surfix Data Center
- YCO Cloud
KEY QUESTIONS ANSWERED:
1. What is the growth rate of the global data center construction market? 2. How big is the data center construction market? 3. What is the estimated market size in terms of area in the global data center construction market by 2029? 4. What are the key trends in the data center construction market? 5. How many MW of power capacity is expected to reach the global data center construction market by 2029?
