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This market research report on US data center construction market covers market sizing and forecast, market share, industry trends, growth drivers, and vendor analysis. The market study includes insights on segmentation by infrastructure (electrical (UPS systems, generators, transfer switches & switchgears, rack PDUs, and others) and mechanical type (cooling systems, racks, and others), general construction (building development, installation and commissioning services, building design, physical security, and DCIM), facility size (small data centers, medium data centers, and hyperscale data centers), tier standards (Tier I and Tier II, Tier III, and Tier IV), and geography (South Eastern US, South Western US, Mid-Western US, Western US, and North Eastern US).
|MARKET SIZE (REVENUE)||USD 11.6 Billion (2024)|
|CAGR||Over 1% (2018-2024)|
|Forecast Year||2020 - 2024|
|Market Segments||infrastructure (electrical (UPS systems, generators, transfer switches & switchgears, rack PDUs, and others) and mechanical type (cooling systems, racks, and others), general construction (building development, installation and commissioning services, building design, physical security, and DCIM), facility size (small data centers, medium data centers, and hyperscale data centers), tier standards (Tier I and Tier II, Tier III, and Tier IV),|
|Geographic Analysis||South Eastern US, South Western US, Mid-Western US, Western US, and North Eastern US|
The increased focus on green data centers construction is a major driver for procuring energy-efficient infrastructure in the US data center construction market
The data centers are confronting with the challenges of increased power and water consumption. To overcome the difficulties, the US data center construction market is increasingly opting for green data center construction. The procurement of renewable energy sources and the implementation of Energy Star certified products is driving the US data center construction market.
Also, the increased operational expenditure by data centers is driving vendors to proactive monitoring and managing support infrastructure. Hence, the increasing vigilance of the infrastructure is driving vendors toward end-to-end facility automation, which is expected to affect the US data center construction market significantly. The US data center construction market is witnessing high investment from colocation and cloud hosting service and hyperscale data center operators.
The market is likely to witness many brownfield constructions, especially in the North-Eastern US. Factors such as favorable government support (attractive tax rebates and remissions), the increased demand for cloud-based services, the growing investment from colocation providers, and increased automation are expected to propel the US data center construction market in the coming years. The US data center construction market is projected to generate revenues of around $12 billion by 2024.
This market research report includes detailed market segmentation by infrastructure, general construction, facility size, tier standards, and geography.
The adoption of lithium-ion and nickel-zinc UPS systems is expected to boost the data center UPS market in the US.
The US data center construction market by electrical infrastructure comprises UPS (uninterrupted power supply) systems, generators, transfer switches & switchgears, rack PDUs, other electrical infrastructure. The UPS system segment dominated the market size in 2018 and is expected to grow at a CAGR of around 1.3% during the forecast period. The increased adoption of lithium-ion and Nickel-Zinc UPS systems is expected to boost the data center UPS market in the US.
The market is also witnessing the growth in generators powered by fuel cells to reduce carbon emission. Further, the increasing complexity of the data center infrastructure has led to the development of automated switchgear technology (ATS). The growing interest in green data centers to reduce the efficiency of data centers is driving the demand for intelligent racks PDUs in the market. Vendors are offering PDUs in a variety of colors for identification purposes. Besides, the increased investment in mega data centers with high-power capabilities is likely to produce high revenues for the other electrical infrastructure segment.
The adoption of innovative infrastructure solutions is expected to drive the US data center construction market
The mechanical construction segment in the data center construction market is categorized into cooling systems, racks, and others. The cooling system segment accounted for the largest market, share in 2018. The extensive use of indirect evaporative coolers, air or water-side economizers, and free cooling chillers is driving the market.
Further, the significance of metrics such as Power Usage Effectiveness (PUE), Water-usage Effectiveness (WUE), and Carbon Usage Effectiveness (CUE) is likely to increase during the forecast period. The market is adopting innovative solutions such as multipurpose cooling systems and modular infrastructure solutions, which are expected to drive the US data center construction market. The market is migrating toward the adoption of over 42U racks - 45U, 47U, and 48U. Also, there is a high adoption of 52U rack units in the Southeast US. Further, innovations in the market have led to the growth of performance-optimized data (POD) centers.
The number of Brownfield, Greenfield, and modular projects is likely to continue in the US market over the next few years
The US data center construction market by general construction is classified into building development, installation and commissioning services, building design, physical security, and DCIM. The growing number of brownfield, Greenfield, and modular facilities projects with the installation of on-site renewable power sources such as wind and solar energy is likely to continue in the market over the next few years. Further, infrastructure vendors are increasingly partnering with major contractors to increase the revenue share.
The growth in greenfield data center facilities will increase revenue opportunities for installation and commission service providers. Further, the designing of data centers is performed by design specialists, contractors, and data center operators. The rise in security breaches is further boosting the market for physical security.
The Data Center Infrastructure Management (DCIM) market is growing due to the rising impact of regulatory standards on data centers. The use of artificial intelligence and robot monitoring technologies is expected to contribute to market growth. For instance, Google uses DeepMind AI solutions to monitor infrastructure in their facilities.
Free cooling solutions are gaining more popularity than liquid-based cooling solutions during the forecast period
Air-based and liquid-based cooling technique are the two major cooling systems available in the US data center construction market. The air-cooling method involves traditional CRACs and free cooling solutions for cooling IT infrastructure in the data center. Free cooling solutions are gaining more popularity than liquid-based cooling solutions. However, the use of chilled water systems is still highly prevalent in the market, particularly in the Northern US. The US market is witnessing the increased adoption of evaporative coolers that facilitate partial cooling with indoor CRAC units among data centers.
The South Eastern, Midwest, and Southwest US are the largest adopters of chiller units in the US data center construction market
CRAC & CRAH units work in conjunction with other cooling units such as chillers, cooling towers, dry coolers, and condensers. There is a growing demand for both CRACs and CRAHs units in the data center to increase efficiency and productivity in the IT infrastructure. The South Eastern and the Mid-Western US are majorly adopting CRAH units. The construction of mega and hyperscale facilities is a driving factor for the increased adoption of both CRAC and CRAH units with 2N redundant configuration.
The South Eastern, Midwest, and Southwest US are the largest adopters of chiller units in the US data center construction market. Further, air-cooled chiller systems are gaining prominence over water-cooled systems due to their easy installation, high efficiency, and low maintenance costs. Cooling towers and dry coolers are installed to reduce heat generated by IT infrastructure.
South-Eastern US and the Western US witnessed the highest investments in the hyperscale data center facilities in 2018
Small, medium, and hyperscale are the three primary facilities in the US data center construction market. The hyperscale segment dominated the US data center construction market in 2018 and is expected to grow steadily during the forecast period. The South Eastern US and the Western US witnessed the highest investment from investors in the hyperscale data center facilities.
Further, Facebook, Apple, Google, Microsoft, PointOne, and EdgeCoreare expected to be the major investors in hyperscale facilities in the US. The South Eastern US witnessed the highest investment in medium data center facilities. Further, Digital Realty, Cologix, COPT data center, Raging Wire Data Center, and Sabey Data Center are the major investors in the medium segment.
Several Vendor are shifting to tier IV facilities due to the increase in the rack density and rise in critical applications inside data centers
In terms of tier standard, the US data center construction market is categorized into Tier I & II, Tier III, and Tier IV. The Tier III standard segment accounted for the highest market size in 2018, which is expected to grow at a CAGR of over 1% during the forecast period. The need for tier III certification from the Uptime Institute to attract customers and increase the occupancy rate will boost the growth of this segment in the US market. However, several operators are expected to shift to Tier IV standard facilities due to the growth in the rack power density and critical infrastructure operations running inside facilities. Further, the Southwest and Midwest regions of the US are emerging the largest adopters of tier IV data centers with 2N+1 cooling unit. The increased investment from hyperscale developers is the major region for the increase in the construction of tier IV data center facilities in the region.
The availability of robust fiber connectivity and low power rates has primarily contributed to the increased growth of Southwestern US data center market
South Eastern US dominated the market share in 2018 and is expected to grow at a CAGR of around 1.2% during the forecast period. Virginia gained the highest investment, followed by North Carolina, Georgia, Alabama, and Florida. Recently, Facebook invested around $2 billion in a data center in Henrico, Virginia. In the Southwestern US, Texas received the highest investments in 2018, whereas Oklahoma and New Mexico witnessed significant investment by Google and Facebook data centers. The availability of robust fiber connectivity and low power rates has primarily contributed to the increased growth in the region.
The US data center construction market is continuing to grow in terms of greenfield, brownfield, and modular data center construction. The market is witnessing the increased growth of data centers across the US, with the high adoption of efficient and modular data center infrastructure solutions. The market has a strong presence of vendors in all three categories - electrical infrastructure, mechanical infrastructure, and general construction.
The adoption of Lithium-ion batteries, fuel cell technology, natural gas generators, intelligent PDUs, and high voltage switchgear is expected to increase the competition in the market among electrical infrastructure vendors.
The direct liquid cooling and immersion cooling market is expected to become competitive as the adoption of HPC infrastructure among data centers is growing in the US. Initiatives such as Open Commute Projects are expected to bring several new cooling techniques and technologies to the market, thereby increasing the competition among mechanical infrastructure vendors.
The US comprises several construction contractors, architectural and engineering firms, physical security vendors, and DCIM solutions providers. Several colocation data centers are being built with multiple data halls, where infrastructure adoption, installation, and commissioning is carried out on-demand basis. Sustainable development of data centers is the leading priority in the market. Construction and design are critical for data center operators due to the strict adherence to regulatory standards from the Uptime Institute.
Market Participants in the US Data Center Construction Market:
Key Construction Contractors
Key Infrastructure Providers
Key Data Center Investors
Other Prominent Construction Contractors
Balfour Beatty, BlueScope Construction, Clune Construction, Fluor Corp., Fortis Construction, Gensler, Gilbane Building Co., HDR, Hensel Phelps, HITT Contracting, Hoffman Construction, JE Dunn Construction, Morrison Hershfield, Mortenson Construction, Rogers-O’Brien Construction, Structure Tone, Walsh Group, and Whiting-Turner Contracting.
Prominent Infrastructure Providers
Prominent Data Center Investors
Market Segmentation by Infrastructure
Market Segmentation by Electrical Type
Market Segmentation by Mechanical Type
Market Segmentation by General Construction
Market Segmentation by Cooling Systems
Market Segmentation by Facility Size
Market Segmentation by Tier Standards
Market Segmentation by Geography
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