United States Data Center Construction Market Projected to Reach $128.14 Billion by 2034 with a CAGR of 6.3%

The U.S. data center construction market is projected to grow from $69.56 billion in 2024 to $128.14 billion by 2034, driven by innovations in hyperscale data centers, sustainability, and strategic partnerships. The healthcare and IT sectors are key contributors, with major players like IBM and DPR Construction leading the market. The demand for cloud services fuels the need for scalable data centers, while sustainable practices and partnerships between market players and real estate firms support the market's expansion.

The U.S. data center construction market is poised for significant growth, projected to expand from USD 69.56 billion in 2024 to USD 128.14 billion by 2034. This robust expansion is driven by several key factors, including innovations in hyperscale data centers, increasing sustainability practices, and strategic partnerships between market players and real estate firms.

Key Drivers of Market Growth

1. Hyperscale Data Centers: The rising demand for cloud services has fueled the construction of hyperscale data centers. Major cloud service providers like AWS, Google Cloud, and Microsoft Azure are key drivers of this trend, necessitating scalable data centers with extensive storage and processing capabilities.

2. Sustainability: There is a growing emphasis on sustainable practices in data center construction. This includes using green materials and modular construction methods to reduce waste and lower the environmental impact. For example, the use of timber framing and organic materials is becoming increasingly common.

3. Strategic Partnerships: Collaborations between data center construction companies and real estate firms are on the rise. These partnerships aim to build high-end data centers that meet the technological needs of various sectors such as healthcare, finance, and education. A notable example is the $257 million state-of-the-art data center in the Illinois medical district, a joint venture between Metro Edge Development Partners and several construction firms.

Market Segmentation

- Tier 3 Data Centers: These data centers occupy a significant portion of the market share due to their complex features and N+1 redundancy, ensuring continuous operation even if primary components fail.

- Healthcare Sector: The healthcare sector is a substantial contributor to the market, driven by the need for electronic health records (EHR) and the digitalization of patient data.

- IT and Telecom Sector: The proliferation of the internet and 5G technology is expected to drive robust growth in this sector.

Key Players

Several major players are shaping the U.S. data center construction market:

- IBM Corp.: Known for its business automation and IT solutions, IBM also aids in the deployment and expansion of data centers.

- PCL Constructors Inc.: A digital and sustainable construction company that offers services in various sectors, including data centers.

- DPR Construction: A commercial contractor focusing on healthcare, high education, hospitality, and manufacturing, among others.

Other notable players include Clune Construction Company, Jacobs Solutions Inc., HITT Contracting Inc., J.E. Dunn Construction Company, HOCHTIEF AG (Turner Construction Company), Hensel Phelps, and AECOM.

Conclusion

The U.S. data center construction market is experiencing substantial growth, driven by innovations in hyperscale data centers, increasing sustainability practices, and strategic partnerships. Key sectors such as healthcare and IT are significant contributors, with major players like IBM and DPR Construction leading the market. As the demand for cloud services and sustainable practices continues to rise, the market is expected to remain robust and dynamic in the coming years.

References

[1] https://finance.yahoo.com/news/united-states-data-center-construction-143100674.html