According to a recent report from Moody’s Ratings, global investment in data centers is projected to reach at least $3 trillion by 2030. This surge is being driven by the massive infrastructure needs of hyperscalers (like Google, Amazon and Microsoft) as they race to expand AI and cloud capabilities.
Here are the key takeaways from the article:
1. Rapid Capacity Growth
Moody’s forecasts double-digit growth in data center capacity through at least 2026. This year marks a significant shift as “mega” hyperscale facilities—those with capacities exceeding 300 megawatts—begin to come online, exponentially increasing the world’s data processing power.
2. Rising Costs and Supply Constraints
While demand is skyrocketing, the “speed to market” is being challenged by several factors:
- Resource Scarcity: Global demand for skilled labor, copper, rare earth metals, and specialized cooling equipment is outpacing supply.
- Power Limitations: Constraints on electrical grids are becoming a primary bottleneck, leading to longer completion timelines.
- Higher Prices: New data centers in 2026 are expected to be significantly more expensive than older facilities. For example, in Northern Virginia, lease rates for hyperscale centers jumped from $110–$150 per kilowatt in 2024 to $130–$190 in 2025.
3. Evolving Risk and Financing
To keep projects moving despite these hurdles, the industry is changing how deals are structured:
- Risk Sharing: Tenants are becoming more willing to share construction risks—such as delays caused by utility availability—to ensure their projects stay on the schedule.
- Debt Repayment: New financing models often aim to repay construction debt within the initial 15-year lease term. This reduces credit risk for lenders and ensures that developers can access the capital needed for multi-billion dollar builds even as costs rise.
The Bottom Line
The data center construction boom is still in its “early stages.” Despite rising costs and infrastructure challenges, the appetite for data capacity is so high that tenants are willing to pay a premium and take on more risk to ensure their facilities get built.