Is America’s data center boom slowing down?

U.S. data center construction slowed in 2025 for the first time since 2020, even as demand for artificial intelligence computing continues to surge, Bloomberg writes. 

Capacity under construction fell to 5.99 gigawatts at year-end, down from 6.35 gigawatts in 2024, according to CBRE. Developers are facing mounting delays tied to permitting, zoning approvals and securing sufficient power, reshaping where projects move forward.

Vacancy rates in primary markets hit a record low 1.4%, while local opposition and concerns about energy use are intensifying in traditional hubs like northern Virginia. 

Some states are reconsidering incentives as power costs rise. At the same time, development is shifting to markets with more available land, including Louisiana and Texas. 

With AI projected to drive trillions in infrastructure investment, the slowdown underscores how grid constraints and regulatory friction are becoming critical bottlenecks in the next phase of digital expansion.

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