Global Data Center Construction Market Size By Infrastructure Type (IT Infrastructure, PD and Cooling Infrastructure), By Data Center Type (Tier 1, Tier 2), By Vertical (Banking, Financial Services and Insurance (BFSI)), By Geographic Scope And Forecast

Data Center Construction Market Size And Forecast

Data Center Construction Market size was valued at USD 23.76 Billion in 2024 and is projected to reach USD 42.05 Billion by 2032, growing at a CAGR of 7.40% from 2026 to 2032.

• Data center construction encompasses the design, installation, and maintenance of specialized facilities that house computer systems, storage, and networking equipment essential for processing and securely managing vast amounts of data.
• This process involves multiple stages, such as site selection, architectural and engineering design, and ongoing facility management to ensure optimal performance and reliability.
• Data centers are indispensable for sectors that rely heavily on digital operations, including telecommunications, finance, healthcare, and e-commerce. Telecommunications companies utilize data centers to support network infrastructure, while financial institutions rely on them for secure storage of sensitive transaction data.
• Additionally, cloud providers depend on data centers to deliver scalable and reliable computing services, while government and educational entities use them for data storage and analysis.
• Key components of data centers include robust physical security, redundant power and cooling systems to minimize downtime, and advanced fire suppression systems to protect equipment.
• High-density server layouts and innovative cooling solutions enhance space utilization and energy efficiency. Scalability is also crucial, allowing companies to expand their data infrastructure seamlessly as their processing demands grow.

Global Data Center Construction Market Dynamics

The key market dynamics that are shaping the global Data Center Construction Market include:

Key Market Drivers

• Exponential Growth in Data Generation and Cloud Services: Global data creation reached 97 zettabytes in 2022 and is projected to reach 181 zettabytes by 2025 according to IDC. Cloud service revenue grew by 23.1% to reach USD 495.7 Billion in 2022 as reported by Gartner. Enterprise data storage requirements increased by 42.2% annually between 2020-2023. Over 75% of enterprise workloads are expected to be cloud-based by the end of 2023, according to Cisco's Global Cloud Index
• Rising Demand for Edge Computing and 5G Infrastructure: 5G connections are expected to exceed 1.1 billion by 2023, according to GSMA Intelligence. Investment in edge data center construction increased by 65% between 2021-2023. Over 150 new edge data center projects were announced in 2022 across major metropolitan areas
• Sustainability Initiatives and Green Data Center Construction: Data center operators invested USD 6.8 Billion in green technologies between 2020-2023. Renewable energy usage in data centers increased by 55% from 2020 to 2023. According to the US Department of Energy, energy-efficient data centers reduced power consumption by 35% compared to traditional facilities. Green data center construction projects increased by 67% globally in 2022.

Key Challenges:

• High Initial Capital Investment and Operating Costs: The average construction cost for a Tier III data center reached USD 12-15 Million per megawatt in 2023, according to Uptime Institute. Cooling systems alone account for 35-40% of total data center operating costs. Land acquisition costs in prime data center markets increased by 45% between 2020-2023. Infrastructure and equipment costs rose by 23% from 2021 to 2023 due to supply chain disruptions
• Power Consumption and Energy Availability Challenges: Data centers consumed approximately 2% of global electricity in 2022 (approximately 500 TWh) according to IEA. Power costs increased by 32% in major data center markets between 2021-2023. 73% of data center operators reported power availability as a major constraint in 2022. Grid capacity limitations delayed 35% of planned data center projects in 2022-2023
• Skilled Labor Shortage and Technical Expertise Gap: The data center industry faced a 45% shortage in skilled workforce in 2023, according to DCF surveys. Training and certification costs increased by 28% from 2020 to 2023. 67% of data center projects reported delays due to workforce shortages in 2022. Average salary demands for experienced data center professionals increased by 35% between 2020-2023.

Key Trends:

• Sustainable and Green Data Center Construction: 75% of new data centers implemented energy-efficient cooling systems in 2022, according to Uptime Institute. Investment in sustainable data center technologies reached USD 18.2 Billion in 2023. 72% of major data center operators pledged to achieve carbon neutrality by 2030. The use of renewable energy in data centers increased by 85% between 2020-2023. Power Usage Effectiveness (PUE) improved to an average of 1.28 in 2023, down from 1.58 in 2020
• Modular and Prefabricated Data Center Solutions: The modular data center market grew by 42% annually between 2021-2023. Construction time is reduced by 40% with prefabricated solutions compared to traditional builds. 65% of new data center projects incorporated some form of modular components in 2023. Cost savings of 25-30% were reported when using prefabricated solutions versus conventional construction
• AI and Automation in Data Center Design and Operations: Implementation of AI-driven design tools increased by 56% in data center construction projects from 2021-2023. Smart monitoring systems reduced operational costs by 35% in new facilities. 85% of new data centers incorporated automated infrastructure management systems in 2023. Digital twin technology adoption in data center design increased by 78% between 2020-2023.

Global Data Center Construction Market Regional Analysis

Here is a more detailed regional analysis of the global Data Center Construction Market :

North America:

• North America substantially dominates the global data center construction market driven by the strong digital infrastructure and cloud service adoption.
• North America accounts for 42% of global hyperscale data centers as of 2023. US businesses increased cloud spending by 35% between 2021-2023
• Over 80% of US enterprises adopted multi-cloud strategies by 2023, driving data center expansion
• In addition, the favorable government policies and investment climate. US federal government allocated USD 8.5 Billion for data center modernization in 2022.
• Tax incentives for data center construction are available in 30 US states as of 2023.
• The US Department of Energy provided USD 2.8 Billion in grants for sustainable data center projects.
• Canadian government invested CAD 4.2 billion in digital infrastructure expansion between 2020-2023.
• Major tech companies announced USD 35 Billion in new data center investments across North America in 2022.
• Silicon Valley alone saw 15 new data center projects worth USD 6.7 Billion in 2022-2023.
• Data center construction in secondary markets (like Phoenix, and Atlanta) increased by 65% from 2020-2023.
• US data center REITs reported a 28% average growth in investment between 2021-2023.

Asia Pacific:

• Asia Pacific is anticipated to witness the fastest growth in the global data center construction market during the forecast period increasing adoption of digital economy & cloud computing.
• According to China's Ministry of Industry and Information Technology, the country's cloud computing market reached approximately 300 billion yuan (USD 46.5 Billion) in 2021, with a year-on-year growth rate of 39.1%
• In India, the government's Digital India initiative led to public cloud spending reaching USD 7.5 Billion in 2022, representing a 23.1% year-over-year increase according to IDC
• In addition, the development of 5G Infrastructure in the region. South Korea reported that by 2022, it had achieved 47% 5G network coverage of its population, one of the highest rates globally
• Japan's Ministry of Internal Affairs and Communications reported that the country's 5G infrastructure investments reached ¥1.7 trillion (USD 12.7 Billion) by the end of 2022
• According to the China Internet Network Information Center (CNNIC), China's internet user base reached 1.05 billion by June 2022, with a penetration rate of 74.4%
• In Southeast Asia, according to a Google-Temasek report, there were 40 million new internet users in 2021 alone, bringing the total to 440 million users.

Global Data Center Construction Market: Segmentation Analysis

The Global Data Center Construction Market is Segmented on the basis of Infrastructure Type, Data Center Type, Organization Size, Vertical, And Geography.

Data Center Construction Market, By Infrastructure Type

• Electrical Infrastructure
• Mechanical Infrastructure
• General Infrastructure

Based on Infrastructure Type, the market is segmented into Electrical Infrastructure, Mechanical Infrastructure, and General Infrastructure. Mechanical Infrastructure is most likely the leading section in the Data Center Construction Market. This is because it includes critical components for data center operation, such as cooling systems and racks, which are required to manage the enormous heat created by data storage. The fastest-growing segment is projected to be electrical infrastructure. The growing demand for efficient data storage and processing necessitates the use of durable and scalable power systems, including UPS (Uninterruptible Power Supply) and other electrical equipment. The emphasis on optimizing power supply is driving growth in this area.

Data Center Construction Market, By Data Center Type

• Tier 1
• Tier 2
• Tier 3
• Tier 4

Based on Data Center Type, the market is segmented into Tier 1&2, Tier 3, and Tier 4. Tiers 3 and 4 are the most common tier classifications in data center building. Tier 3 provides high availability and little downtime, making it appropriate for important processes. Tier 4 provides even better reliability, with a near-zero tolerance for disruptions, making it ideal for mission-critical jobs. Tier 2 data centers are predicted to be the fastest growing segment. These provide enough uptime for non-critical applications at a cheaper cost, which is appealing in a developing market with diversified data requirements.

Data Center Construction Market, By Organization Size

• Small Organization
• Medium Organization
• Large Organization

Based on Organization Size, the market is segmented into Small Organization, Medium Organization, and Large Organization. Large businesses now dominate the Data Center Construction Market. This is due to the increasing volume of data that businesses manage, as well as the growing need for high-performance computers and cloud services. The fastest-growing group is likely to be medium-sized businesses. This development is linked to the increasing adoption of cloud computing and digitalization across industries, including mid-sized businesses.

Data Center Construction Market, By Vertical

• Banking, Financial Services and Insurance (BFSI)
• IT & Telecommunications
• Government & Defense
• Healthcare

Based on Vertical, the market is segmented into Banking, Financial Services and Insurance (BFSI), IT & Telecommunications, Government & Defense, and Healthcare. IT and Telecommunications are projected to maintain their dominance due to the ever-increasing volume of data generated by enterprises. The advent of cloud services, big data analytics, and the Internet of Things (IoT) all add to the demand for large data storage facilities.

Key Players

The "Global Data Center Construction Market" study report will provide valuable insight with an emphasis on the global market. The major players in the market are SAS Institute, Inc., IBM Corporation, Fortis Construction, Turner Construction Co., HITT Contracting, Inc., JE Dunn Construction Group, Inc., DPR Construction Inc., Hensel Phelps Construction Co., Inc., AECOM, MA Mortenson Company, Inc. The competitive landscape section also includes key development strategies, market share, and market ranking analysis of the above-mentioned players globally.

Our market analysis also entails a section solely dedicated to such major players wherein our analysts provide an insight into the financial statements of all the major players, along with product benchmarking and SWOT analysis. The competitive landscape section also includes key development strategies, market share, and market ranking analysis of the above-mentioned players globally.

• Data Center Construction Market Recent Developments
• In April 2024, AGM Group Holdings Inc., a technology business, inked a Memorandum of Understanding with RED DOT ANALYTICS PTE. LTD. to build AI hyper-connected, GPU-powered data centers.
• In March 2023, Vertiv announced a collaboration with iPoint, a multi-brand distributor of computer peripherals and electronic gadgets for Bahraini businesses and individuals.