A photo in The Washington Post shows an Amazon data center towering over several large residential homes in Loudoun County, Virginia, some just 50 feet away from the facility.
It’s the perfect shot to illustrate how data centers—giant computer warehouses processing everything from online orders to generative artificial intelligence (AI)—are consuming land, power and building materials.
It’s a big market—building data centers. Are you going after it? If you want to, don’t worry. A project near you is probably being planned.
$48 Billion by 2029
The size of the U.S. data center market, valued at nearly $25 billion in 2023, will reach nearly $48 billion by 2029, according to Arizton Advisory and Intelligence.
By the end of this decade, the power needs of data centers will grow three times higher than current capacity, a McKinsey and Company article says. Today, data centers draw 3 to 4% of total U.S. power demand. But by 2030, they’ll use 11 to 12%.
The demand for power is shifting where data centers are being built. The big players—Amazon Web Services, Apple, Google, Meta (Facebook), Microsoft, Tesla and others—are scouting out cheaper, more sustainable, places where more power is or will soon be available.
The center of the universe for data centers has been northern Virginia. Other top markets have included Arizona, California, Oregon and Texas. But with power transmission constrained in these markets, projects have moved to secondary markets in Colorado, Florida, Georgia, Massachusetts, Minnesota, Nevada, New Jersey, New York, Ohio, Pennsylvania and Utah.
Beyond the secondary markets are the emerging power markets, which have power projects scaling to meet demand. These include Alabama, Iowa, Indiana, Kansas, Mississippi, Nebraska, New Mexico, North and South Carolina, Oklahoma, Tennessee, Wisconsin and Wyoming, according to a McKinsey map.
All in all, there’s a data center project coming soon to a town near you.
600 Miles of Framing Studs
What is the construction market like? My sources and various media reports show that data center construction for wall-and-ceiling firms can vary in size, scope and specialty requirements.
In August last year, the mayor of Mesa, Arizona, John Giles, posted an update on the construction of a five-building Meta data center, saying on Facebook it “will incorporate over 600 miles of framing studs and 700 acres of drywall.”
In its fulfillment of data center projects, DPR Construction based in California is turning to offsite construction to reduce the skilled labor required on site, a Construction Dive article says. Andy Kirby, DPR’s central region advanced tech market leader, told Construction Dive that his firm was “able to fabricate electrical rooms, central utility plants and major mechanical and electrical piping racks” on data center projects across Texas. The result, Kirby said, was increased efficiency and better quality by managing the most complex scopes of work offsite.
For those in construction, data centers present an opportunity wrapped in complexity.
C. Brent Allen, vice president at Compass Construction in Ohio, says working on data centers is “a whole different dynamic.” Some companies working on such projects are signatory contractors, he says. But in Columbus, Ohio, is a “friendly market” with open-ended contracts on the many data center projects underway, Allen says.
“There’s a significant amount of work for our association’s members in these facilities,” he adds.
As data centers continue their relentless expansion, swallowing real estate and power at an unprecedented pace, the question isn’t whether they’ll be built near you—it’s when.
For those in construction, data centers present an opportunity wrapped in complexity. You may need offsite fabrication capability or access to acres of drywall to fulfill a job. No matter what is required, it’s a booming market—humming along.
