Supply in primary data center markets increased by 34% to roughly 6,922 MW in 2024
Dallas – February 27, 2025 – The North American 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 the 456.8 MW under construction in 2020.
This surge highlights the growing need for data centers that can meet the power demands of AI companies, according to CBRE’s latest North American Data Center Trend Report.
Last year, the eight primary North American data center markets* saw a significant uptick in completed construction, with total supply reaching 6,922.6 MW—a 34% year-over-year increase. This growth outpaced the 26% increase in new supply in 2023. Yet the sector still is struggling to meet current demand due to extended construction timelines driven by power constraints and supply chain delays.
In 2024, the average vacancy rate in primary markets reached a record low of 1.9%. Vacancy rates decreased across all primary markets for the first time since CBRE started tracking the data center sector in 2013. In tandem, the national average lease rate rose to a record $184.06 per kW/month, up 12.6% from a year ago, marking the third straight year of double-digit percentage increases.
“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.”
The power demand of artificial intelligence is a key influence on site selection as occupiers prioritize sites with power available in the next 18 to 24 months, a short timeframe in the current market. Sites with access to power are attracting attention from developers and investors regardless of location, which is a shift from previous years. Markets in North Carolina, Northern Louisiana and Indiana are positioned for significant growth due to greater power accessibility, available land and tax incentives.
Top Data Center Markets
Primary market net absorption jumped from 329.6 MW in 2020 to 1,809.5 MW in 2024—a 450% increase in just four years. In 2024, Atlanta emerged as the national leader in net absorption, achieving 705.8 MW of positive net absorption — nearly 39 times higher than year-end 2023 (18 MW). Notably, this is the first time any primary market has surpassed Northern Virginia in net absorption since CBRE began tracking the sector.
Despite being outpaced in overall net absorption, Northern Virginia remained the largest data center market with 2,930.1 MW of total inventory, 17% larger than a year prior due to robust construction. Northern Virginia recorded 451.7 MW of total absorption in 2024.
Two markets experienced significant increases in inventory in 2024 from the prior year: Atlanta (1,000.4 MW total inventory, a 222% increase) and Phoenix (602.8 MW total inventory, a 67% increase).
Other notable markets include Dallas Fort-Worth, where developers have 605.6 MW currently under construction with 87% of that new supply preleased. This new supply could double size of the Dallas Fort-Worth market by the end of 2026.
The national building boom extended to secondary markets like Austin, where there is 463.5 MW of supply under construction.
“In 2025 we expect new markets to emerge that can offer quicker access to power,” said Gordon Dolven, Director of Americas Data Center Research at CBRE. “We are monitoring all types of power generation sources, including natural gas, solar, wind, geothermal, and nuclear power.”
To read the full report, click here.
*The eight primary North American data center markets are Northern Virginia, Dallas-Fort Worth, Silicon Valley, Chicago, Phoenix, New York Tri-State, Atlanta and Hillsboro.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2024 revenue). The company has more than 140,000 employees (including Turner & Townsend employees) serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
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