JLL Warns of Critical Data Center Space Shortages in North America

North America’s colocation data centers are running out of available space, and the construction pipeline is already heavily spoken for, according to a new industry analysis by JLL. The firm estimates that addressing this shortfall could demand investments approaching $1 trillion over the coming years.

Capacity Nearly Maxed Out

JLL’s North America Datacenter Report reveals that vacancy levels in colocation facilities have hit historic lows, with just 2.3% of capacity open for tenants. That is a steep drop from nearly 10% vacancy in 2020. The research suggests that availability will likely remain extremely limited through at least 2027, keeping the market under severe pressure.

Andrew Batson, who leads data center research for JLL in the Americas, explained that the development pipeline—currently totaling around 8 GW—is already 73% pre-leased. “Even if leasing demand softens, we don’t expect the vacancy rate to climb above 5% in the next three years,” he noted. A more realistic scenario, JLL argues, is a vacancy floor of roughly 2% that persists for the foreseeable future.

The Bigger Problem: Power Access

While space is scarce, power is even harder to secure. On average, data center operators must now wait about four years to connect to the electric grid. These power bottlenecks are creating major obstacles for new builds and slowing down efforts to ease the capacity crunch.

Rapid Growth in Regional Markets

Since 2020, many secondary data center hubs have exploded in size. Columbus, Ohio, has seen capacity surge by an eye-catching 1,800%, while Austin–San Antonio has expanded roughly 500%. However, in terms of total megawatts added, the largest gains came in:

• Northern Virginia: +3,975 MW

• Dallas: +1,008 MW

• Atlanta: +828 MW

Looking ahead, the most active development pipelines are clustered in Northern Virginia (7 GW), Phoenix (5 GW), Dallas (5 GW), Chicago (4 GW), and the Las Vegas/Reno corridor.

A Missing Piece: AI Data Centers

Interestingly, JLL’s report sidesteps the role of artificial intelligence–focused facilities. That omission is deliberate: AI-driven campuses are designed around specialized computing hardware, whereas traditional colocation centers are flexible, allowing tenants to bring in their own infrastructure—including AI servers if they choose. Comparing the two directly may not capture the unique dynamics of each segment.

Outlook

The combination of near-zero availability, multi-year waits for grid power, and an overwhelming pre-leasing trend points to one conclusion: businesses seeking additional data center capacity must plan well in advance, secure space early, and be prepared for long delays. For providers, the situation ensures strong demand, but for customers, it represents a mounting challenge that could affect both economic expansion and digital infrastructure resilience across North America.