Data Center Construction Hits 37.7GW Record as Lenders Get Picky

A pipeline that grew by half in six months

Cushman & Wakefield's latest Americas Data Center Update reports that data center construction across the Americas has reached a record. The H1 2026 report, published in mid-September, counts 37.7 gigawatts of capacity under construction across the region, with 91.7% of it committed to tenants before delivery11. The region also has 50.3GW of operational capacity, 94.1% of it in the United States. The planned pipeline beyond current construction has grown to 285GW11.

The six-month change is the striking part. In the firm's H2 2025 update, released in February, 25.3GW was under construction and regional vacancy was 4.2%12. Six months later, construction is up by roughly half and vacancy has fallen to 3.8%, even after large amounts of new capacity were delivered11. Normally, heavy new supply loosens a real estate market. In data centers it hasn't: tenants are leasing capacity faster than it can be built.

The report's main argument goes beyond the size of the numbers. It says growth is becoming "increasingly localized." In its account, power allocation rules, transmission limits, requirements that developers help pay for infrastructure, and local regulation now shape outcomes market by market11. That builds on the February report, which described a shift to "managed growth." In some jurisdictions that shift has already meant delayed or cancelled projects and the loss of by-right zoning12.

Three firms, three very different counts

The major brokerages agree on the direction of the market, but their numbers differ widely.

• CBRE counts 7,481MW under construction across eight primary North American markets. That is a record, up 24.8%, with more than 80% preleased and vacancy at 1.4%21.
• JLL puts North American construction at 66GW, 95% pre-committed, with vacancy around 1% for a third straight year2124.
• Cushman & Wakefield reports 37.7GW across the whole Americas and the highest vacancy of the three, at 3.8%23.

These figures do not contradict each other. Each firm covers a different area: CBRE looks only at established hubs, while JLL says frontier markets hold 77% of the capacity now being built21. Cushman & Wakefield's broader coverage, which includes Latin America and Canada, likely explains its higher vacancy figure23.

The takeaway is that the established hubs, the core of the market, are essentially full. CBRE puts Northern Virginia vacancy at 0.2%21. Only about 1,500MW remains available for preleasing, which is roughly six months of supply at the current pace of demand21.

The sources also differ on which market leads construction. In February, Cushman & Wakefield said Virginia had 6.3GW under construction, about a quarter of the Americas pipeline12. CBRE now says Atlanta has overtaken Northern Virginia as the most active construction market among the primary hubs, with nearly 2,900MW underway27. Cushman & Wakefield's new report still lists Virginia, Atlanta, Chicago and Dallas as anchor markets. It also points to West Texas, Pennsylvania, Alberta and Cheyenne as places drawing some of the largest proposed projects11. The most likely explanation is that both trends are real. The hubs keep growing because their connectivity is hard to replicate, while the largest single projects are going to places where grid power is available.

The financing story is getting more complicated

For commercial real estate lenders, the strong demand numbers explain why money keeps flowing. The credit markets, however, are starting to distinguish between deals.

The volumes are large:

• Bank lenders committed an estimated $121.91 billion to data center properties in 2025, with an average loan of $1.2 billion1.
• Data center commercial mortgage-backed securities (CMBS) issuance hit $11 billion in 2025, up 266% from the year before1.
• Another $4.9 billion was issued in the first half of 2026, about 9% of the single-asset, single-borrower (SASB) market, meaning bonds backed by one large property or portfolio1.
• JLL puts combined CMBS and asset-backed securities (ABS) volume for data centers at $17 billion in the first half of 2026, up 29% year over year7.

Lending to build new facilities is also moving away from banks. A Newmark debt specialist says construction lending has shifted from bank balance sheets toward private credit as banks look harder at the sector1. Deal sizes are larger than ever. Related Digital and Blackstone raised $16 billion in construction financing, led by PIMCO-managed funds, for an Oracle-leased campus in Michigan1. Blue Owl provided a $975 million loan to recapitalize a newly finished, fully leased facility at the Gainesville Crossing campus in Northern Virginia1.

At the same time, bond markets are showing the first real sign of caution. Trepp found that senior AAA spreads on fixed-rate data center SASB CMBS widened 21 basis points in the week ending October 23, to 182 over Treasuries. Over the same week, comparable bonds backed by other property types barely moved4. Since December, fixed-rate data center AAA spreads have widened 60 basis points and single-A spreads 105 basis points4.

Trepp also notes that every loan behind the deals it examined was current, and none had been sent to a special servicer4. In other words, the repricing reflects investors' worries about AI infrastructure, not actual defaults.

The tension is clear. The physical market has never been tighter, yet bond investors are asking for more compensation to hold the debt. This is not a contradiction. Rising vacancy is not the worry. Lenders are asking about the tenants who signed those leases, how heavily the market depends on a few hyperscalers, and what these buildings would be worth if AI spending slowed. Cushman & Wakefield's own global comparison argues that an AI infrastructure bubble "appears unlikely," because power and permitting limits naturally prevent overbuilding13. That is a reasonable view of supply. It does not fully address credit risk on the tenant side, which is the risk the spread widening appears to price.

Some traditional mortgage lenders are holding back for structural reasons. A partner at HSF Kramer notes that data centers often fall under project and infrastructure finance rather than conventional real estate lending1. The overall picture is that capital remains plentiful but is no longer easy to get. Proven operators with investment-grade tenants have access to it; speculative projects increasingly do not3.

The office angle: data centers are propping up construction counts

The office market comparison is the most telling one. Federal construction statistics count data centers under private office construction. By that measure, data center projects made up 63.3% of U.S. private office construction spending in August 2026, at a seasonally adjusted annual rate of about $85 billion21. This means office construction totals now mostly reflect data centers, not new workplace buildings.

The conventional office market looks very different. Office CMBS delinquency was 12.2% in September, close to January's record of 12.3%9. Lenders are increasingly unwilling to extend troubled loans. At Chicago's Aon Center, the special servicer "unequivocally denied" a three-year extension request9. The broader SASB market shows the shift: through September, issuance moved away from office and retail and toward apartments, hotels and data centers. Data centers accounted for $6.2 billion, about 9% of the SASB balance5.

The gap also shows up in valuations. Stabilized hyperscale data centers trade at cap rates (annual income as a share of price, where lower means more expensive) of roughly 5.5% to 6.25%, compared with about 7.5% to 8% for trophy downtown office buildings8.

What it means for REITs

For data center real estate investment trusts (REITs) and the large private platforms, tight supply has given landlords pricing power. Digital Realty reported Americas base rents of $156 per kW per month on new leases above 1MW in the second quarter, and $293 for smaller deployments10. JLL says rents have risen nearly 70% since 202024.

Costs are rising too. Cushman & Wakefield's development cost guide puts all-in construction at $17.6 million per MW excluding chips, up 21% since late 2024. Powered land has climbed 51% year over year, to $584,000 per MW10.

The securitization market remains an important exit for these owners. A $2.05 billion QTS data center portfolio financed by nine banks was among the largest SASB deals of the year5. Operators outside the major hubs are testing the market too: US Signal is seeking up to $525 million in an ABS deal backed by 10 facilities in markets such as Waukee, Iowa, and Hillsboro, Oregon7.

The reading

The Cushman & Wakefield update describes a market whose fundamentals are still strengthening. Construction is at a record, precommitment is above 90%, and vacancy is falling even as supply grows11. The main limits are physical and political: power, permitting and community opposition. Any easing of supply seems years away, and the February report said meaningful relief was unlikely before 203012.

The next stress point is likely to be financing rather than leasing. Trepp's spread data is the first clear sign that debt investors are separating data center risk from the rest of commercial real estate4. If that continues, the localization Cushman & Wakefield describes may also apply to credit, not just land and power. Locations with strong tenants and secured power will get financed cheaply, while the rest will pay more.