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Real EstateJun 7, 2024

Nearly 100% of Survey Respondents Plan To Increase Data Center Investments, Bringing Back Dot Com Vibes

AI Infrastructure

Noah Weidner

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If there were ever a moment for AI to peak, it would be hard to find a better Hollywood moment than when Nvidia CEO Jensen Huang signed a woman’s chest. But the party isn’t over yet. Blackstone’s prediction in January that acquiring data center operator QTS could be their best investment ever is just the beginning. According to CBRE, some of the world’s biggest real estate investors are gearing up for even more upgrades for their data centers.

97% of respondents aim to boost their investments this year, up from 89% in 2023 — with at least 44% of respondents planning to spend over $500M on upgrades this year alone.
The CEO of GPU marketplace Hydra Hosttold WSJ that “the fervor to build is probably the greatest since the first dot-com wave.”

The world revolves around data centers: Even Bitcoin mining companies are pivoting towards data center infrastructure. TC Energy, one of the largest natural gas operators, predicts that data centers could significantly boost natural gas demand. Utilities companies have essentially turned into a growth sector overnight. However, the WSJ notes that insatiable demand for data centers has led to shortages in essential components, suitable properties, and the required power infrastructure. So… what happens if all this investment doesn’t yield the expected value and revenue?