Americas Data Center Colocation Market Growth Insights – Investment to Reach USD 92.90 Billion, Market Area to Reach 32.36 Million Sq. Ft., Power Capacity to Exceed 8,141 MW, and Colocation Revenue to Reach USD 53.66 Billion by 2031.

AMERICAS DATA CENTER COLOCATION MARKET SIZE ANALYSIS

The Americas data center colocation market size by investment was valued at USD 46.73 billion in 2025 and is expected to reach USD 92.90 billion by 2031, growing at a CAGR of 12.13% during the forecast period. The data center colocation market in the Americas is experiencing robust growth, fuelled by accelerating cloud adoption, AI-driven workloads, and the continued digitalisation of industries. The US remains the dominant market, representing nearly 90% of installed capacity, while Canada and Latin America are gaining traction through increasing hyperscale investments, expanding digital connectivity, and access to renewable energy.

As demand continues to evolve, the market’s next phase of growth will be shaped by AI-ready infrastructure, high-density deployments, renewable power procurement, and strategic expansion into emerging data center locations across the region.

Investment and consolidation are strengthening the Americas' digital infrastructure ecosystem, with acquisitions, joint ventures, government incentives, and continued submarine cable deployment supporting market expansion. Strategic investments are increasingly focused on securing powered land, existing capacity, and development pipelines amid intensifying competition for suitable sites and reliable power demand, increasing renewable-energy procurement, and growing investment in energy-efficient infrastructure.

AI is driving demand for AI-ready colocation facilities with high-density power, advanced cooling, and scalable infrastructure. As hyperscalers and enterprises expand generative AI and ML workloads, colocation enables faster deployment and flexibility. In response, operators are expanding hyperscale campuses and adopting liquid cooling and upgraded electrical systems to support next-generation GPU clusters.

AMERICAS DATA CENTER COLOCATION MARKET INSIGHTS BY AREA

The Americas data center colocation market footprint by area is projected to reach 32.36 million sq. ft. by 2031, driven by increasing hyperscale leasing, AI deployments, and enterprise cloud adoption. This growing demand is encouraging operators to expand capacity across both established and emerging markets. Land acquisition has emerged as a key expansion strategy, enabling developers to secure future development capacity and access to critical power infrastructure. Leading operators are also building strategic land portfolios to support long-term expansion and strengthen their presence in high-growth data center markets across the Americas.

Regional expansion is gaining momentum beyond traditional US hubs, with Northern Virginia continuing to dominate North American capacity while markets such as Seattle and Winnipeg are seeing new AI-focused developments. In Latin America, Chile is emerging as a strategic destination for colocation data center investment, supported by large development sites and renewable-energy potential, indicating a broader geographic diversification of the Americas’ data center landscape.

AMERICAS DATA CENTER COLOCATION MARKET INSIGHTS BY POWER CAPACITY

AI, GPU-accelerated computing, and HPC workloads are driving a structural increase in data center power demand across the Americas, with higher rack densities and larger campuses requiring greater utility capacity. The market is forecast to add approximately 8,141 MW of power capacity by 2031, reflecting continued investment in high-density AI infrastructure.

Growing power requirements are encouraging operators to secure long-term renewable energy through PPAs and on-site generation, with the US and Canada benefiting from comparatively competitive electricity costs while Brazil, Chile, and Colombia leverage abundant renewable resources to support low-carbon data center expansion.

AMERICAS DATA CENTER COLOCATION MARKET INSIGHTS BY COLOCATION REVENUE

The Americas data center colocation market is projected to generate approximately USD 53.66 billion in revenue by 2031, driven by sustained demand for scalable, carrier-neutral, hyperscale, cloud, and AI-ready infrastructure. The US dominates the regional market, with Northern Virginia remaining the world’s largest colocation hub. Wholesale colocation is expected to be the fastest-growing segment.

While the US continues to account for most of the regional revenue, Latin American markets are emerging as high-growth destinations for colocation investment. Colombia is projected to record the highest revenue CAGR of approximately 29%, followed by Mexico, supported by hyperscale investments, cloud adoption, and expanding digital infrastructure. Increasing AI workloads, GPU deployments, and hyperscale cloud expansion are expected to sustain double-digit market growth across the Americas through 2031.

RECENT DEVELOPMENTS & NEWS IN THE AMERICAS DATA CENTER COLOCATION MARKET

1. In January 2026, Equinix announced plans to invest over $836 million to develop its Dallas 12 (DA12) campus in Texas, comprising two four-story data center buildings totalling more than 372,000 square feet; construction is scheduled through 2028 to expand capacity for the growing cloud and AI demand.
2. Vantage Data Centers announced its decision to invest over $350 million in 2025 to further expand its footprint in Canada. This investment will fund the development of QC24, the fourth facility in the company’s growing Quebec City campus. QC24 will deliver an additional 32 MW of IT capacity, bringing the four-data center campus to a total of 86 MW, strengthening the Capitale-Nationale region’s digital infrastructure.
3. In September 2025, Ascenty announced the launch of SCL03, its third data center facility in Santiago, with an investment of around $114 million. The 16 MW facility is powered by 100% renewable energy and features a closed-loop cooling system, supporting the company's expansion strategy to grow its footprint in Chile to 150 MW.
4. In February 2026, Terranova, the hyperscale data center platform backed by Actis, announced the launch of its first data center facility in the Queretaro region. The data center has been designed to meet the growing demand for AI workloads, cloud services, and mission-critical applications.

AMERICAS DATA CENTER COLOCATION MARKET KEY TRENDS

Artificial Intelligence Transforming the Data Center Market Landscape

AI is accelerating demand for high-density, AI-ready colocation infrastructure across the Americas, driving investment in higher power capacities, liquid cooling, and GPU-ready facilities. For example, Vantage Data Centers’ $3 billion, 224 MW NV1 campus in Reno, Nevada, is purpose-built to support high-density AI workloads.

Colocation providers are expanding AI capabilities through strategic partnerships and infrastructure upgrades. For instance, Ascenty partnered with Vertical Data in 2026 to provide GPU-ready, liquid-cooling-enabled infrastructure across Brazil, Chile, Mexico, and Colombia, enabling enterprises to deploy AI workloads without developing dedicated facilities.

AI is transforming the broader data center infrastructure stack, including power distribution, cooling, networking, and energy systems. Equinix’s Fabric Intelligence and NVIDIA’s DGX-Ready data center program, which includes providers such as Equinix, Digital Realty, Flexential, and DataBank, demonstrate the growing focus on AI-optimized colocation environments.

Adoption of Renewable Energy & Sustainability Practices by Data Center Operators

Sustainability is becoming a strategic priority for colocation providers as AI and cloud workloads drive higher power consumption. Operators are increasing renewable energy procurement, with Equinix sourcing approximately 2.84 TWh of renewable electricity across the Americas in 2025, while Ascenty signed a renewable energy agreement with Casa dos Ventos to secure an average of 110 MW for its Brazilian data centers.

Colocation operators are increasingly integrating renewable and low-carbon power solutions into new developments. For example, Elea Data Centers’ BEL1 facility in Belém, Brazil, is designed to operate on 100% renewable energy, while QScale’s Quebec campus uses hydroelectric power and free cooling for much of the year to support energy-efficient AI and cloud workloads.

Sustainable backup power and energy-efficient technologies are also gaining adoption, including HVO, fuel cells, and advanced cooling systems. Digital Realty and CloudHQ use HVO for backup generators, while Equinix has deployed Bloom Energy fuel cells across multiple facilities, demonstrating the shift toward lower-carbon and more resilient data center operations.

AMERICAS DATA CENTER COLOCATION MARKET DRIVERS

Rising Adoption of Cloud-based Services Driving Colocation Demand

Rapid cloud and AI adoption is driving demand for colocation infrastructure across the Americas, as hyperscalers and enterprises increasingly require strategically located facilities for low-latency connectivity and multi-cloud interconnection. Major providers such as AWS, Microsoft Azure, Google Cloud, IBM Cloud, and Oracle Cloud are expanding their regional infrastructure and network presence.

Colocation is enabling enterprises to access hyperscale cloud platforms without building dedicated data centers, supporting hybrid- and multi-cloud deployments. For example, AWS Direct Connect is available through providers such as Equinix, Digital Realty, Cologix, QTS Data Centers, and Flexential, while Google Cloud’s dedicated interconnect on-ramps across Digital Realty facilities provide direct connectivity to cloud services.

AI workloads are further accelerating hyperscale and high-density colocation demand, with operators expanding capacity through large-scale deployments and partnerships. Examples include Flexential’s 13 MW deployment for CoreWeave in Plano, Texas, and Core Scientific’s expansion to more than 260 MW of critical IT load to support CoreWeave’s AI infrastructure.

Improvement in Connectivity via Submarine Cables

Submarine cable infrastructure is becoming increasingly critical to the Americas’ digital ecosystem, supporting the growing bandwidth and low-latency requirements of cloud, AI, and cross-border digital services. Strategic gateways such as Miami, Virginia Beach, Myrtle Beach, and Fortaleza are attracting colocation investment due to their proximity to major cable landing stations.

Colocation providers are increasingly integrating cable landing infrastructure with carrier-neutral data centers to strengthen interconnection and network resilience. For example, DC BLOX’s Myrtle Beach Cable Landing Station combines subsea connectivity with colocation capacity, while MDC Data Centers is developing cable landing stations in Cancún and Veracruz to support the MANTA submarine cable and improve connectivity across Mexico and the Americas.

New transatlantic and regional cable projects are expanding route diversity and strengthening digital resilience. Projects such as V.tal’s 6,027-mile Brazil–US Synapse cable, Millicom’s TAM-1 integration, and Claro’s new AMX-1 landing point in Puerto Rico are increasing bandwidth and creating alternative connectivity routes to support the region’s expanding cloud, AI, and data center infrastructure.

AMERICAS DATA CENTER COLOCATION MARKET RESTRAINTS

Power Supply Challenges and Grid Instability

Power availability and grid capacity are emerging as major constraints on data center expansion across the Americas, as existing transmission networks and substations struggle to accommodate rapidly growing AI-driven loads. In the US, PJM has warned of a potential 60 GW power shortfall over the next decade, while AEP’s contracted capacity pipeline has reached 63 GW, around 90% of which is driven by data center demand.

Grid constraints are increasingly affecting data center operations and development timelines. In July 2026, a transmission outage in Northern Virginia caused data centers to disconnect from the PJM grid, resulting in the loss of more than 3 GW of load. Similarly, limited transmission capacity in Latin America is restricting access to renewable power, with Chile curtailing more than 6,084 GWh of renewable energy in 2025.

Power availability is becoming a key factor in data center site selection, encouraging operators to consider locations with reliable grid access, faster interconnection, and alternative power solutions. Increasing adoption of on-site generation, natural gas systems, and BESS is helping operators improve resilience while reducing dependence on constrained grid infrastructure.

Rising Construction and Operating Costs

Rising construction and operating costs are creating increasing pressure on the Americas colocation market, driven by higher prices for materials, labour, electrical equipment, cooling systems, and energy. Construction costs have increased by approximately 3–5% across major markets, while AI-driven high-density deployments are further increasing infrastructure requirements.

Competition for power-connected land and grid capacity is pushing up development costs, particularly in established hubs such as Northern Virginia, São Paulo, Bogotá, and Querétaro. At the same time, tariffs on critical equipment and new electricity rate structures are increasing the cost of developing and operating large-scale data centers.

Operators are responding by securing power and infrastructure earlier in the development cycle, including long-term electricity contracts, renewable PPAs, on-site generation, and BESS. These strategies can improve cost predictability and reduce exposure to energy price volatility, grid upgrade charges, and regulatory pressures.

AMERICAS DATA CENTER COLOCATION MARKET SEGMENTATION INSIGHTS

INSIGHTS BY COLOCATION SERVICES

The Americas data center colocation market by colocation services is segmented into retail and wholesale colocation. The retail colocation service accounted for the largest market share of around 57% in 2025. Retail colocation data centers follow a multi-tenant business model and allow customers to rent half, full, or multiple rack spaces, generally supporting capacities of less than 250 kW. Customers using retail colocation services pay for rack space, power, bandwidth, cloud connectivity, and interconnectivity, with costs varying depending on the service provider and the services adopted.

Retail colocation services are highly suitable for enterprises that require lower computing power at a single site or across multiple locations to serve global and local customers. The flexibility to scale rack space, power, and connectivity based on business requirements is supporting the adoption of retail colocation services across the Americas.

INSIGHTS BY INFRASTRUCTURE

Based on the infrastructure, general construction dominates and holds the largest Americas data center colocation market share in 2025. General construction in data centers consists of building development plans, including site preparation and core and shell development, installation and commissioning services, building design services, including architectural and engineering design, security systems such as fire and smoke detection, intruder detection systems, access control, closed-circuit television (CCTV) surveillance, external vehicle crash barriers, external security fences, and mantraps, as well as data center infrastructure management (DCIM).

The growing demand for colocation facilities across the Americas is increasing investments in new data center construction and expansion projects. The rising adoption of cloud computing, AI, and high-performance computing is encouraging operators to develop larger and more advanced facilities, increasing demand for construction, design, installation, and security services.

INSIGHTS BY ELECTRICAL INFRASTRUCTURE

Based on the electrical infrastructure, the UPS segment shows a significant share of around 28% in 2025. The increasing need for reliable and uninterrupted power supply is encouraging data center operators across the Americas to deploy N+1 and 2N redundant backup generators, supporting higher data center uptime and operational resilience. In addition, the growing focus on reducing carbon emissions is expected to drive the adoption of HVO-powered generators across the Americas data center market.

For instance, Digital Realty has adopted Hydrotreated Vegetable Oil (HVO) for backup generators at its PDX12 (Hillsboro, Oregon), SC1 (Santa Clara, California), and LAX12 (El Segundo, California) data centers. The renewable diesel alternative supports lower-carbon backup power operations and is expected to reduce CO₂ emissions by approximately 12,000 metric tons.

INSIGHTS BY MECHANICAL INFRASTRUCTURE

The cooling systems segment dominated the mechanical infrastructure of the Americas data center colocation market in 2025, owing to the increasing adoption of efficient cooling solutions across data center facilities in the Americas. Data center facilities commonly deploy a combination of air-based, water-based, and increasingly liquid-based cooling systems, depending on climate, facility design, and rack density. In terms of redundancy, N+1 and 2N configurations are widely adopted in Tier III and Tier IV facilities to maintain continuous cooling availability during equipment failures or maintenance. The growing deployment of AI, GPU, and high-performance computing workloads is increasing rack power densities and driving greater adoption of direct-to-chip liquid cooling and other advanced liquid-based cooling technologies to manage higher thermal loads efficiently.

INSIGHTS BY COOLING SYSTEM

Based on the cooling system, the CRAC & CRAH Units account for the largest share of the Americas data center colocation market in 2025. CRAC and CRAH systems are evolving from standalone room-level cooling units into intelligent, hybrid, and modular cooling components integrated with free cooling, AI-driven controls, and liquid cooling ecosystems to support high-density data center environments.

This evolution is driving the adoption of advanced CRAC and CRAH cooling solutions across colocation facilities. For instance, the MTL2 facility of Cologix utilizes DX cooling with free-cooling capabilities and centralized humidification, highlighting the adoption of efficient and advanced cooling systems in the Americas data center colocation market.

INSIGHTS BY COOLING TECHNIQUES

The liquid-based cooling techniques shows highest growth with a CAGR of 17.84% during the forecast period. Advanced cooling technologies are rapidly evolving in hyperscale and AI-driven data centers, with operators and vendors shifting from traditional air-based systems to liquid cooling, immersion cooling, and emerging alternative mediums to efficiently manage the rising GPU heat densities as well as improve energy and water efficiency.

QScale leverages Canada’s cold climate to provide free cooling for up to 80% of the year at its flagship QScale Q01 campus near Quebec City. This eco-efficient approach cuts energy use for high-density AI and HPC workloads.

INSIGHTS BY GENERAL CONSTRUCTION

In terms of general construction, the core & shell development segment contributes around 48% of the market share in 2025. The Americas data center colocation market is witnessing the development of greenfield and brownfield facilities, along with the expansion of large-scale AI-ready and hyperscale campuses across the US, Canada, and Latin America. Owing to growing power demand and grid constraints in major US data center hubs, operators are increasingly prioritizing dedicated substations, on-site power generation, renewable energy integration, and advanced cooling infrastructure. These requirements are increasing the complexity and scale of data center construction, creating additional opportunities for general construction, electrical, mechanical, and specialized infrastructure contractors across the region.

In July 2026, QTS Data Centers announced to develop up to 11 data center buildings across approximately 465 acres at Lancium's Clean Campus in Hall County, Texas, backed by a 1 GW grid connection and expected to generate more than $10 billion in capital investment.

INSIGHTS BY TIER STANDARDS

Based on tier standards, Tier III dominates the Americas colocation data center market with the largest share. A Tier III data center is constructed with a higher level of reliability and a minimum redundancy of N+1 in both power and cooling systems. This design results in approximately 1.6 hours of downtime annually, providing operational availability of around 99.982%.

The demand for highly reliable infrastructure is also supporting the expansion of Tier IV data centers across the Americas, with more than 25 Tier IV facilities located across countries including the US, Canada, Mexico, Colombia, and Chile. The growing presence of Tier IV facilities reflects the increasing demand for highly resilient infrastructure with fault-tolerant systems and continuous availability for critical workloads.

AMERICAS DATA CENTER COLOCATION MARKET GEOGRAPHICAL ANALYSIS

US

The US remains the largest and most established data center colocation market globally, supported by substantial investment from infrastructure funds, private equity firms, real estate investors, and hyperscale technology companies. Growing demand for cloud computing, AI, and digital services continues to drive significant capital deployment and large-scale data center development across major US markets.

It is also home to many of the world's leading colocation providers, including Equinix, Digital Realty, QTS Data Centers, CoreSite, CyrusOne, and Flexential, making it the largest and most mature colocation market that is supported by extensive interconnection ecosystems and continued investment in AI-ready infrastructure.

Canada

Canada is emerging as a high-growth colocation data center colocation market in North America, supported by rising cloud adoption, AI workloads, enterprise digital transformation, and demand for domestic data hosting. The market is further strengthened by abundant low-carbon electricity, a cool climate that supports energy-efficient cooling, and data sovereignty requirements. These factors are attracting hyperscalers and enterprise customers, with colocation data center investment in Canada projected to grow at a CAGR of 20.77%, highlighting strong opportunities for continued capacity expansion and infrastructure development.

Brazil

Brazil accounts for a significant share of nearly 60% in the data center colocation market in Latin America, supported by abundant land availability around major hubs such as São Paulo, Campinas, and Rio de Janeiro, enabling large-scale hyperscale and colocation campus development with future expansion potential. The country’s digital transformation initiatives, growing IoT and big data adoption, and strong demand for digital services are attracting significant investment in data center infrastructure.

Mexico

Mexico is becoming an increasingly important data center colocation market in Latin America, supported by its proximity to the US, expanding digital infrastructure, and growing demand for cloud and AI services. However, high development costs remain a key consideration, with data center construction costs ranging from approximately $10.0 million to $10.5 million per MW in 2025, making Mexico one of the most expensive data center construction markets in Latin America. Despite the higher costs, continued demand for capacity is supporting further investment from hyperscale and colocation operators.

Emerging Markets

Emerging markets such as Chile, Colombia, Mexico, and rest of Latin America are gaining traction as alternative data center destinations, supported by growing cloud and digital service adoption, improving fiber connectivity, renewable energy availability, and increasing demand for local data hosting. These markets are attracting hyperscale and colocation operators seeking new sources of power, land availability, and geographic diversification beyond established US data center hubs.

Chile

Chile accounts for approximately 14% of investment share in the Latin American data center colocation market, supported by growing cloud adoption, digital transformation, and increasing demand for data hosting and AI infrastructure. The country’s abundant renewable energy resources, particularly solar and wind, further strengthen its position as an attractive location for sustainable data center development and large-scale hyperscale and colocation investments.

Colombia

Colombia is emerging as a strategic data center colocation market in Latin America, driven by rising cloud adoption, digital transformation, and increasing demand for local data hosting. Bogotá remains the primary hub, supported by expanding connectivity and access to renewable power, while growing hyperscale and colocation requirements are creating opportunities for new capacity and infrastructure development.

Argentina

Argentina can be seen as a high-growth data center colocation market in Latin America, supported by increasing cloud adoption, digital transformation, and rising demand for localized digital infrastructure. The country’s comparatively competitive electricity costs and growing renewable energy potential further enhance its attractiveness for data center development. Data center colocation investment in Argentina is projected to grow at a CAGR of 27.45%, indicating strong potential for future colocation and hyperscale capacity expansion.

AMERICAS DATA CENTER MARKET VENDOR LANDSCAPE

The Americas data center colocation market is characterized by the presence of major hyperscale-focused data center developers, colocation operators, and digital infrastructure providers, including Applied Digital, Aligned Data Centers, Cirion Technologies, Cologix, Compass Datacenters, CloudHQ, CyrusOne, DataBank, Digital Realty, Elea Data Centers, Equinix, eStruxture Data Centers, Vantage Data Centers and other regional and international operators. These companies are expanding through hyperscale campuses, AI-ready facilities, strategic acquisitions, and investments in power- and connectivity-rich markets across the region.

Revenue concentration among leading operators highlights the strong position of Digital Realty, Equinix, QTS Data Centers, Aligned Data Centers, and CyrusOne, which collectively represent a significant portion of the Americas colocation market. At the same time, regional and emerging providers account for approximately 46.6% of total revenue, indicating a fragmented competitive landscape supported by demand in Tier II markets, localized requirements, and underserved connectivity hubs.

Numerous new entrants are expanding their presence in the Americas data center sector to address the growing demand for data center services across North and Latin American countries. Some of the recent and emerging entrants in the market include Ada Infrastructure, Ardent Data Centers, Atlantic Data Centers, Beacon Data Centers, Beale Infrastructure, Big Sky Digital Infrastructure, CleanArc Data Centers, CloudBurst Data Centers, Colovore, Crane Data Centers, DARKNX, Data District, Fermaca Networks, Fleet Data Centers, Lambda, Layer 9 Data Centers, LightHouse Data Centers, metrobloks, NE Edge, Penzance, Prometheus Hyperscale, Related Digital, Rowan Digital Infrastructure, Surfix Data Center, TECfusions, Terranova, and Tract Americas, among others.