US Data Center Construction Market Size (2024 - 2029)

US Data Center Construction Market Analysis

The US Data Center Construction Market size is estimated at USD 13.24 billion in 2024, and is expected to reach USD 19.78 billion by 2029, growing at a CAGR of 8.36% during the forecast period (2024-2029).

• The US market is the most mature and shows steady growth in terms of growth and operations. The growth of the US data center construction market is attributed to the increasing adoption of IoT, the development of 5G networks, and the adoption of cloud-based services by businesses. Adopting digitalization across industries would contribute to a rise in data center investments by colocation, cloud, internet, and telecommunication providers, as well as the demand for the streaming of online entertainment content at high speeds.
• The country's data center market is expected to grow owing to a rise in rack power density, connectivity improvements with other nations, the installation of microgrids in data centers, 5G connectivity, edge data center technology, and new UPS battery technologies.
• The US government is encouraging data center investments by a various means, including increasing the availability of land for development, lowering electricity tariffs, and encouraging the procurement of renewable energy.
• For example, Arizona state offers various incentives to businesses that operate in the foreign trade zone. Businesses in a trade zone are entitled to a 72.9% exemption in state real and personal property taxes. Consequently, such initiatives would contribute to the growth of the data center construction market in the United States over the next decade.
• Despite the escalating demand, the data center industry is found to be prone to some challenges when it comes to satisfying high demand. The data center industry faces new construction delays due to supply chain disruptions, as in many other real estate verticals. Increasing labor, building materials, and other costs have also boosted capital expenditures.
• The COVID-19 pandemic placed additional pressure on the overall economy across sectors and highlighted the value and potential of the cloud-based work environment provided by data centers. During the COVID-19 pandemic, 53% of Americans said that the internet had been vital. This has increased the use of more data centers in the country.

US Data Center Construction Industry Segmentation

The data center construction market involves data center planning, design, and physical construction. This includes developing facilities that house information technology infrastructure, such as servers, storage systems, networking equipment, and related components. The market encompasses various services and products related to the construction and outfitting of data centers, ranging from architectural and engineering services to installing specialized systems for power, cooling, and security.

The US data center construction market is segmented by infrastructure (electrical infrastructure [UPS systems, and other electrical infrastructure], mechanical infrastructure [cooling systems, racks, and other mechanical infrastructure], and general construction), tier type (tier-I and II, tier-III, and tier-IV), and end user (banking, financial services, and insurance, IT and telecommunications, government and defense, healthcare, and other end users). The report offers market forecasts and size in terms of value in USD for all the above segments.