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Demand for more artificial intelligence (AI), cloud computing and digital services are all driving massive investment in data center development in the U.S. Projects continue to come out of the ground nationwide, with developers targeting markets that can support the scale and infrastructure these facilities require.
The surge is running up against new resistance at the local level. In some states and communities, residents and officials are raising concerns about the size of these sites, their power demands and their long-term impact on land and resources. Most of the projects are still moving ahead, but that pushback is getting louder as these large-scale facilities move into new areas and compete for finite power and land resources.
“A new generation of data centers that can support advanced AI is rapidly being built up,” Goldman Sachs states in a recent report. “In the U.S. alone, spending on the construction of this infrastructure has tripled over the last three years. Even as new facilities come online, occupancy rates remain near record highs for third-party leased data-centers across most U.S. markets.”
Tracking the Data Center Boom
Goldman Sachs Research forecasts data center demand to grow by about 50% to 92 GW by 2027, with a compound annual growth rate (CAGR) of 17% between 2025 and 2028. Should demand for AI turn out to be lower than expected, it says that growth rate could be closer to 14%. “In a more bullish scenario, in which GPUs require even more power than predicted, or customer demand for AI models is higher than expected,” the company says, “the [CAGR] could reach 20%.
Global real estate firm JLL has been tracking the data center boom closely and says vacancy rates for these facilities stayed at a record low 1% in 2025. At the same time, new ones continue to be planned, built and brought online. It also says that 92% of capacity currently under construction is pre-committed, either through binding lease agreements or owner-occupied development.
JLL says more than 35 GW of data center capacity is under construction in North America, an “extraordinary volume by historical standards,” it adds. “For context, this is roughly equivalent to the annual electricity consumption of the UK or Italy.”
Of this pipeline, nearly 60% is leased, while the remaining 40% will be owner-occupied by hyperscalers (i.e., companies that build very large data centers at massive scale). Today, 64% of capacity under construction is located in what JLL calls “frontier markets,” including West Texas, Tennessee, Wisconsin, and Ohio. “Texas, when viewed as a single market, could overtake Northern Virginia as the world’s largest data center market by 2030,” it says. “Abundant energy resources, ample land availability and a business-friendly operating environment support this trajectory.”
Banning Data Center Growth
Not everyone likes the idea of a data center coming to their town or city. Currently, nine states are considering statewide bans and a tenth (Pennsylvania) is considering one. Earlier this month, for example, Maine laid out a plan to freeze large data-center construction, which would make it “the first state to enact such a measure as communities across the U.S. grapple with fallout from the boom in artificial intelligence,” WSJ reports.
The Maine bill calls for a ban on major new data-center construction until November 2027, so the state can assess the impact of such development on the environment and electricity grid. Legislators have introduced measures to temporarily ban or restrict data centers in New York, South Carolina, Oklahoma and other states, WSJ adds. “In Ohio, one of the top states for data-center development, a group of rural activists is collecting signatures to put a statewide ban of large data centers on a November ballot.”
At the federal level, U.S. Senators Bernie Sanders and Alexandria Ocasio-Cortez introduced a bill that would pause new data centers in the U.S. until “safeguards are in place to protect workers and consumers and ensure the technologies don’t harm the environment,” AP reports.
Towns Taking a Stand
Drilling down to specific towns, residents in Port Washington, Wis., recently voted on a measure that would halt future data center development in its 12,000-person town. This is the nation’s first anti-data center referendum, and it probably won’t be the last.
Yahoo! News says the initiative came in response to an $8 billion data center project that’s expected to receive more than $450 million in property tax breaks. The project also wouldn’t have to pay state sales tax on everything from construction to the servers inside to electricity at the site, “which is estimated to require as much electricity as the city of Los Angeles once fully operational.”
