The global data center colocation market size by investment is expected to grow at a CAGR of 15.98% from 2025 to 2031.
DATA CENTER COLOCATION MARKET TRENDS
AI Transforming the Landscape of the Data Center Market
- The AI industry is set to significantly increase the size of hyperscale data centers. Even though the current AI investments haven't fully compensated for the growth in hyperscale data centers, the capacity of these data centers, especially for AI workloads, is expected to almost triple in the next five to six years. With the rising adoption of AI across several industries, new data centers are being designed to support high-density AI-based workloads.
- Europe is undergoing rapid digital transformation driven by widespread enterprise adoption of AI, cloud, and data-driven technologies, significantly increasing demand for data center infrastructure. Countries such as Germany, the UK, and Italy show near-universal digital connectivity, with Germany reporting 93% of organizations prioritizing AI and digital technologies, the UK reaching 97.8% internet penetration with over 55 million social media users, and Italy achieving 90% internet penetration.
- Rapid digitalization and AI adoption are driving strong demand for hyperscale and AI-ready data center infrastructure across Latin America. Governments and enterprises are investing heavily in AI, connectivity, and digital transformation initiatives. Examples include Brazil's $4 billion National AI Plan, Colombia's $116 million National AI Policy, and Mexico's plans for Latin America's first NVIDIA-powered HPC and AI center in Nuevo Leon with an estimated $1 billion investment. These initiatives are increasing demand for high-density, GPU-ready, and cloud-enabled data center capacity.
Renewable Energy and Sustainability Initiatives by Data Center Operators
- With the rapid growth in AI and cloud workloads, energy demand is increasing significantly. As a result, sustainability has become essential for managing carbon emissions, operating costs, and ensuring long-term grid stability. Data centers must prioritize sustainability, especially as local governments and residents are increasingly opposing projects that consume excessive energy, strain water resources, and contribute to higher emissions or noise levels.
- For a more sustainable approach, data center operators in the US are increasingly investing in clean and renewable energy. Several companies are securing long-term power purchase agreements, building on-site solar and wind projects, as well as integrating battery storage systems to reduce carbon emissions and improve energy efficiency.
- Latin America is strengthening its position as a sustainable data center hub through renewable energy expansion and policy support. Countries such as Argentina, Chile, Colombia, and Mexico have established ambitious clean energy targets, creating favorable conditions for hyperscale deployments. For example, Argentina's proposed OpenAI-Sur Energy Stargate project links AI infrastructure deployment with dedicated renewable energy supply, while Colombia released over 5GW of grid connection capacity in 2025 to accelerate new solar and wind projects that can support future data center demand.
- The Nordic region is emerging as a global benchmark for sustainable data center development, leveraging abundant renewable energy resources and ambitious national decarbonization targets. Countries such as Sweden, Norway, Denmark, and Finland are increasingly attracting hyperscale investments due to access to low-carbon power. Examples include Equinix's Stockholm facilities operating on 100% renewable energy, EcoDataCenter's Falun campus powered entirely by wind and hydropower, and Amazon's 472 MW wind power agreements in Finland, which increased its contracted renewable energy capacity in the country to 772 MW.
- The UAE aims to achieve the target of zero carbon emissions by 2050. Dubai has announced its plan to achieve a 50% reduction in carbon emissions by 2030. The Energy Strategy 2050 is the first energy strategy in the UAE that aims to increase the composition of renewable energy from 25% to 50% in the total energy mix by 2050.
- AI data centers are changing sustainability standards in several ways, including raising acceptable power density limits, expanding metrics beyond Power Usage Effectiveness (PUE), driving the adoption of liquid cooling, tightening expectations for water use, requiring sourcing of carbon-free energy, promoting waste heat reuse, demanding grid-friendly operations, and emphasizing the full lifecycle impact.
DATA CENTER COLOCATION MARKET SEGMENTATION INSIGHTS
- Data center operators are increasingly deploying high-capacity UPS systems (>750 kVA) with redundant configurations such as N+1, N+N, and 2N to ensure reliable and efficient operations, while smaller facilities and hyperscale environments often use UPS systems below 500 kVA and in-rack solutions. For example, Sify Technologies' Rabale data center uses an N+N UPS configuration with 10 minutes of backup, and KIO Networks' MEX 6 facility is equipped with a 900 kVA UPS system.
- Despite being a major source of carbon emissions, generators remain essential for data centers due to ongoing power reliability and grid stability challenges, driving operators to adopt more efficient and cleaner backup power solutions. For example, Africa Data Centres' JHB1 facility provides 48 hours of generator-backed power, Equinix's BG2 data center uses diesel generators with N+1 redundancy, and Gulf Data Hub's Dubai facility operates a 16,000 kVA N+1 generator system with 24 hours of backup fuel storage.
- Modern data centers are designed in line with ASHRAE cooling guidelines and Uptime Institute Tier standards, leveraging advanced cooling technologies and redundancy to optimize thermal efficiency and ensure reliable operations. For example, NTT DATA's Ho Chi Minh City 1 facility uses water-cooled systems, CRAH units, AHUs, and cold aisle containment, while Urbacon's DC5 data center features N+1 direct evaporative cooling and Moro Hub's Dubai facility is equipped with cooling towers, N+1 chillers, CRAH units, and hot/cold aisle containment.
GLOBAL DATA CENTER COLOCATION MARKET GEOGRAPHICAL ANALYSIS
- Investment in the US data centers nearly doubled as compared with 2024, fueled by strong construction activity from both colocation and hyperscale operators. It is estimated that the demand for data centers will continue to grow as Artificial Intelligence (AI) becomes more prevalent. The Southeastern US, including states such as Virginia, Georgia, and North Carolina, continues to lead in data center investments; this is followed by the Southwestern US.
- Canada is also among the developed and established data center markets in North America. As a key regional hub, the demand for data centers is steadily increasing due to its strategic location (near the US), infrastructure, as well as the government initiatives and support for data center development.
- The UK and Germany are among the biggest data center colocation markets in Europe, accounting for around 19.81% and 19.04% of the European data center colocation market's investments, respectively, in 2025; these countries continue to witness data center investments from local as well as global data center operators.
- In 2025, the APAC data center colocation market by investments grew by around 40.13% as compared with 2024. The market is expanding significantly due to several factors such as the adoption of Artificial Intelligence (AI) and the demand for edge computing. China accounted for a share of around 37% in the APAC data center colocation market investments in 2025, with Southeast Asia contributing approximately 21.22% to the region's data center colocation market investments during the same period.
- Brazil holds a significant share of the market in the data center growth of Latin America. The digital transformation policies of the country, coupled with the widespread adoption of IoT and Big Data, support major investments in data center infrastructure.
- Norway and Finland are among the fastest-growing data center markets in the Nordic region, driven by factors such as the growing adoption of digital platforms, cloud adoption across businesses, and the adoption of advanced technologies, including AI, IoT, and big data.
DATA CENTER COLOCATION MARKET VENDOR LANDSCAPE
- The global data center colocation market has the presence of key investors such as AirTrunk, Aligned Data Centers, CDC Data Centres, CloudHQ, Compass Datacenters, CyrusOne, DataBank, Digital Realty, EdgeConneX, Equinix, Global Switch, Iron Mountain, NTT DATA, QTS Realty Trust, STACK Infrastructure, ST Telemedia Global Data Centres (STT GDC), Switch, Vantage Data Centers and others.
- In August 2025, AirTrunk secured new sustainability-linked financing of approximately $10.37 billion from approximately 60 banks for the development of sustainable and green data centers across Australia, Hong Kong, Malaysia, and Singapore.
- In October 2025, AtlasEdge secured $294.8 million in sustainability-linked funding backed by Banco Santander and ING to develop data centers at its data center campus in Lisbon, Portugal. The seven-year term bond will be used to construct two data centers, LIS001 and LIS002, which will cost $72 million and $219 million, respectively. The company also announced that it had acquired land for a third data center, LIS003.
- In September 2025, ODATA, part of Aligned Data Centers, secured $1.02 billion in green financing, the largest sustainable funding package ever for data centers in Latin America, to support the development of environmentally focused projects across Brazil, Mexico, Chile, and Colombia.
- Some of the major colocation data center operators in US include CyrusOne, DataBank, Digital Realty, Equinix, NTT DATA, EdgeConneX, Aligned Data Centers, H5 Data Centers, HostDime, Hut 8, Iron Mountain, QTS Realty Trust, Sabey Data Centers, Skybox Datacenters, STACK Infrastructure, Stream Data Centers, Switch, T5 Data Centers, TierPoint, and Vantage Data Centers.
- Some of the major colocation data center companies, operating in the European market include, Ark Data Centres, AtlasEdge, atNorth, Borealis Data Center, Bulk Infrastructure, CloudHQ, Colt Data Centre Services, CyrusOne, DataPro, Data4, Digital Realty, EdgeConneX, Equinix, Global Switch, Global Technical Realty, Goodman, Green Mountain, Iron Mountain, Ixcellerate, Keppel Data Centres, LCL Data Centers, maincubes SECURE DATACENTERS, Nation Data Center, nLighten, NTT DATA, Pure Data Centres Group, QTS Realty Trust, Rostelecom, STACK Infrastructure, Telehouse, Thesee DataCenter, Vantage Data Centers, VIRTUS Data Centres, Yondr Group, and others.
- Some of the major colocation data center operators in the APAC data data center colocation market include ST Telemedia Global Data Centres, NTT DATA, Princeton Digital Group, EdgeConneX, Colt Data Centre Services, GDS Holdings, Equinix, Digital Realty, CtrlS Datacenters, China Unicom, Global Switch, CapitaLand, China Mobile International, Chayora, BDx Data Centers, AdaniConneX, Iron Mountain, KT Corp, and others.
- The Latin America market has the presence of several global and regional colocation operators that are investing in the market. Some of them include Equinix, Ascenty, ODATA (Aligned Data Centers), Scala Data Centers, EdgeConneX, HostDime, Tecto Data Centers, Elea Data Centers, Cirion Technologies, Claro, Gtd Group, NextStream, and several others.
Key Data Center Investors
- AirTrunk
- Aligned Data Centers
- CDC Data Centres
- CloudHQ
- Compass Datacenters
- CyrusOne
- DataBank
- Digital Realty
- EdgeConneX
- Equinix
- GDS Holdings
- Global Switch
- Gulf Data Hub
- Iron Mountain
- NTT DATA
- QTS Realty Trust
- STACK Infrastructure
- ST Telemedia Global Data Centres (STT GDC)
- Switch
- Vantage Data Centers
Other Data Center Investors
- AdaniConneX
- Africa Data Centres
- American Tower
- Applied Digital
- AQ Compute
- AtlasEdge
- Atman
- atNorth
- Bulk Infrastructure
- CapitaLand
- center3
- China Mobile International
- China Telecom Corporation
- China Unicom
- Chindata Group
- Chunghwa Telecom
- Cirion Technologies
- Cologix
- Colt Data Centre Services
- Core Scientific
- Crusoe
- Csquare
- DAMAC Digital
- Data4
- DCI Indonesia
- Digital Edge DC
- EdgeCore Digital Infrastructure
- Echelon Data Centres
- Elea Data Centers
- Empyrion Digital
- ePLDT
- eStruxture Data Centers
- Etix Everywhere
- Flexential
- Global Technical Realty
- Goodman
- GTD
- iXAfrica Data Centres
- Kao Data
- Keppel Data Centres
- Khazna Data Centers
- KIO Data Centers
- LCL Data Centers
- LG CNS
- LG Uplus
- maincubes SECURE DATACENTERS
- MedOne
- MEEZA
- NEXTDC
- NextStream
- NorthC
- Novva Data Centers
- Nxtra by Airtel
- OneAsia Network
- Open Access Data Centres
- Orange Business
- Penta Infra
- PowerHouse Data Centers
- Prime Data Centers
- Princeton Digital Group
- Pure Data Centres Group
- QScale
- Quantum Switch
- Racks Central
- Rostelecom
- Sabey Data Centers
- Scala Data Centers
- Serverfarm
- Sify Technologies
- Singtel (Nxera)
- Skybox Datacenters
- SUNeVision Holdings
- Tecto Data Centers
- Telehouse
- Urbacon Data Centre Solutions
- VIRTUS Data Centres
- WhiteFiber
- Yondr
NEW ENTRANTS
- 3E Network Technology Company
- 1911 Data Centers
- 247 Data Centers
- Adriatic DC
- AmpTank & Greensky Energy
- Ada Infrastructure
- Agility Logistics Parks
- Anan
- Anglesey Land Holdings
- Apatura
- Apto
- Aqylon Nexus
- Arcem
- AREA Group of Companies
- Ardent Data Centers
- Art Data Centres
- Asia Pacific Land (APL)
- Aslan Energy Capital
- Atlantic Data Centers
- Aroundtown SA
- AVAIO Digital Partners
- Ava Telecom
- Azora
- Beacon AI Centers
- Beale Infrastructure
- Big Sky Digital Infrastructure
- Bilt Technology
- BW Digital
- Changhae Development
- Chinachem Group
- CleanArc Data Centers
- Cloudoon
- Compute Nordic
- Crane Data Centers
- CURRENC Group
- DARKNX
- Data Castle
- Data Center Partners
- Data District
- DATA for MED
- DataGrid New Zealand
- DataR GmbH
- DataVolt
- DC Connects
- Deep Green
- Desert Dragon Data Centers
- Digital Land & Development
- Digital Reef
- Doma Infrastructure Group
- Drax Group
- ECO-LocaXion
- EDC One
- Edora
- EID LLP
- Elite UK REIT
- Energia Group
- EngineNode
- Everstone Group
- Evolution Data Centres
- evroc
- FCDC Corp
- Fermaca Networks
- FF Ventures
- Fleet Data Centers
- FLOW Digital Infrastructure
- Form8tion Data Centers
- Fossefall
- FutureData
- GARBE Data Centers
- Gatineau Data Hub (GDH)
- GIGA-42
- Global Telecommunications
- GreenScale Data Centres
- GreenSquareDC
- Greystoke
- Haoyang Data
- Henox IT and Datacenters
- House of Data
- HUMAIN
- ICADE
- IGIS Asset Management
- Infracrowd Capital
- Inuverse
- IPTP Networks
- Kakao Corp
- Kasi Cloud
- Kennedy Wilson
- Keystone
- Keysource and Namsos DataSenter
- KOSCOM
- Lambda
- Layer 9 Data Centers
- Lehr Consultants International
- Liberum Navitas
- LightHouse Data Centers
- Latos Data Centres
- MARKHAM
- Megaspeed AI
- Metrobloks
- Mistral AI
- MyTelehaus
- NED
- NE Edge
- NEOIX
- NES DATA
- NETHITS IT SOLUTIONS
- Northtree Investment Management
- NXN Datacenters
- OKESTRO
- Otech
- Panattoni
- Penzance
- Polarise
- Polarnode
- Portland Trust
- Prometheus Hyperscale
- Related Digital
- Rowan Digital Infrastructure
- Scale42
- SC Zeus Data Centers
- SEAX Global
- SEGRO plc
- Sesterce
- SGC Energy
- Siagon Asset Management
- Sierra DC
- sineQN
- Skygard
- Supernode by Quinbrook Infrastructure Partners
- Surfix Data Center
- Techtonic
- Terranova
- Thylander
- TPG Angelo Gordon
- Tract
- Trifalga
- Tritax Group
- Valencia Digital Port Connect
- Valore Group
- VDR
- VITALI SPA Societa Benefit
- VSDATA
- Wilton International
- WS Computing AS
- X5 Group
- XTX Markets
- ZDATA Group
- Zr Power Holdings
Segmentation by Colocation Type
- Retail Colocation
- Wholesale Colocation
Segmentation by Infrastructure
- Electrical Infrastructure
- Mechanical Infrastructure
- General Construction
Segmentation by Electrical Infrastructure
- UPS Systems
- Generators
- Transfer Switches & Switchgear
- 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 Techniques
- 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 Standard
- Tier I & II
- Tier III
- Tier IV
Segmentation by Geography
- North America
- Latin America
- Brazil
- Mexico
- Chile
- Colombia
- Argentina
- Other Latin American Countries
- Western Europe
- The U.K.
- Germany
- France
- Netherlands
- Ireland
- Switzerland
- Spain
- Italy
- Belgium
- Portugal
- Greece
- Other Western European Countries
- Nordics
- Sweden
- Denmark
- Norway
- Finland
- Iceland
- Central & Eastern Europe
- Russia
- Poland
- Austria
- Czechia
- Other Central & Eastern European Countries
- Middle East
- UAE
- Saudi Arabia
- Israel
- Oman
- Qatar
- Turkey
- Bahrain
- Kuwait
- Other Middle Eastern Countries
- Africa
- South Africa
- Kenya
- Nigeria
- Egypt
- Other African countries
- APAC
- China
- Hong Kong
- Australia
- New Zealand
- India
- Japan
- Taiwan
- South Korea
- Rest of APAC
- Southeast Asia
- Singapore
- Indonesia
- Malaysia
- Thailand
- Philippines
- Vietnam
- Other Southeast Asian Countries
KEY QUESTIONS ANSWERED:
1. How big is the global data center colocation market?
2. What is the growth rate of the global data center colocation market?
3. What are the key trends in the global data center colocation market?
4. What is the estimated market size in terms of area in the global data center colocation market by 2031?
5. How much MW of power capacity is expected to reach the global data center colocation market by 2031?