The North American data centre sector is undergoing a period of significant change, reflected in a record-low vacancy rate of 1% for the second consecutive year. This position highlights continued expansion and ongoing structural shifts across the market.
A recent report from JLL outlines these developments. It states that 64% of the 35 gigawatt (GW) construction pipeline now extends beyond traditional mature markets. As a result, Texas is positioned to potentially overtake Virginia as the world’s largest data centre market by 2030.
JLL’s updated report reflects an evolution in its market analysis, including expanded coverage of hyperscale activity and the addition of more than 40 frontier markets.
Available capacity remains limited to small and fragmented blocks, leaving limited flexibility for large-scale deployments. As a result, tenants are increasingly securing space for delivery in 2027 or 2028, demonstrating sustained demand within the sector.
More than half of the current construction activity is taking place in frontier markets. Texas accounts for 6.5 GW of ongoing construction, supporting projections that it could become the largest global market by 2030. Other states, including Tennessee, Wisconsin and Ohio, are also benefiting from strong energy availability and business-friendly operating conditions.
Supply constraints continue to support rent growth. Data centre rents increased by 9% in 2025, in line with a five-year compound annual growth rate (CAGR) of 10%, reinforcing consistent pricing momentum across the sector.
These conditions have enabled landlords to achieve higher rental levels on renewals, while tenants are experiencing increased costs when negotiating new leases.
Hyperscalers are driving significant investment, with $710 billion of planned capital expenditure for 2026. However, infrastructure constraints, including grid connection timelines that average around four years, are influencing how major tenants plan and deliver new data centre capacity.
This situation is contributing to expansion into frontier markets with greater access to power resources. Collaboration with utility providers is becoming more common as developers explore approaches such as flexible load planning and phased power deployment to accelerate connections.
The combination of strong debt availability, growing AI-related demand and increased investment activity has positioned data centres as a prominent segment within North American commercial real estate. Asset-backed security volumes exceeded $17 billion in 2025, nearly doubling from the previous year, while single-asset single-borrower lending volumes rose to over $11 billion, representing a threefold increase. These figures reflect increasing complexity and maturity in transaction structures across the sector.
