In global commercial real estate investment markets, data centres are all the rage. While stock markets continue to suffer bouts of volatility as sentiment oscillates between concerns artificial intelligence (AI) will fall short of expectations and fears it will prove more disruptive than many think, the fundamentals of data centres are exceptionally strong.
According to JLL, global data centre occupancy was 97 per cent at the end of last year while 77 per cent of all capacity under construction is committed to tenants. Hyperscalers – leading technology companies and cloud service providers such as Amazon and Meta – occupy more than half of all data centre space, providing security to landlords. This is why data centres account for a fast-growing share of global commercial property fundraising.
However, the market has reached an inflection point. The rapid growth of AI workloads has amplified constraints such as power availability, land access, sustainability requirements and community acceptance. In the United States, a fierce backlash against data centres has become “a structural constraint on AI infrastructure” that “has expanded to broader anti-AI sentiment”, Jefferies said in a report.
In the first quarter of this year, at least 75 data centre projects worth around US$130 billion were delayed or blocked by local opposition, close to the total value of schemes stymied by local resistance during the whole of 2025.
Last month, New York moved to become the first US state to impose a temporary ban on the construction of large new data centres because of fears that the scale and speed of development put too much strain on energy and water resources.
Lawmakers in more than a dozen other states are mulling temporary bans on the facilities. Research group Data Centre Watch said “moratoria [have] expanded from local exceptions to a multi-front political battle”.
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