UNITED STATES

DEVELOPMENT
DATA CENTER

COST
GUIDE
2025
 DATA CENTER DEVELOPMENT COST GUIDE 2025

KEY FINDINGS

POWER AVAILABILITY HAS BECOME AN

INCREASINGLY PRESSING CHALLENGE
IN ESTABLISHED DATA CENTER
MARKETS, limiting the market’s ability
to meet demand. As a result, data center
developers have shown greater interest
in emerging and tertiary markets, where
power availability is less of a concern.

THE WEIGHTED AVERAGE COST OF DATA

CENTER LAND THROUGH OCTOBER 2024
WAS $5.59 PER SQUARE FOOT (PSF) OR
$244,000 PER ACRE, reflecting a decrease
of $0.90 psf ($39,000 per acre) compared
to the previous year. That said, average U.S.
data center land prices for parcels 50 acres
or larger have increased 23%, from $4.39
per square foot (psf) in 2023 to $5.40 psf
in 2024 through October.

DATA CENTER LAND TRANSACTIONS

ARE GROWING IN SIZE. In 2024, the
average parcel spanned 224 acres—a
144% increase since 2022. This growth is
largely driven by data center developers
looking to develop multi-building
campuses, enabling phased development
and future expansion to reach on-site
capacity thresholds amid high demand.

BUILDING AND CONSTRUCTION COSTS

ARE STILL RISING BUT AT A SLOWER
RATE COMPARED TO RECENT YEARS,
signaling a deceleration in the pace
of increases.

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 DATA CENTER DEVELOPMENT COST GUIDE 2025

CONSTRUCTION COSTS
COSTS REMAIN HIGH BUT ARE DECELERATING

UNITED STATES: COSTS INDICES (JAN-2020 = 100)

Oct-24
140
135
130
125
120
115
110
105
100
95
90

Jan-19
Mar-19
May-19
Jul-19
Sep-19
Jan-20
Mar-20
May-20
Jul-20
Sep-20
Nov-20
Jan-21
Mar-21
May-21
Jul-21
Sep-21
Nov-21
Jan-22
Mar-22
May-22
Jul-22
Sep-22
Nov-22
Jan-23
Mar-23
May-23
Jul-23
Sep-23
Nov-23
Jan-24
Mar-24
May-24
Jul-24
Sep-24
Building Cost Index Construction Cost Index Common Labor Index Skilled Labor Index

Index 2021-2023 CAGR YOY - OCT ‘24 Change

Building Cost 8.7% 1.8% -6.9%

Construction Cost 5.1% 1.0% -4.1%

Common Labor 1.4% 1.8% +0.4%

Skilled Labor 2.9% 0.9% -2.0%

Source: Cushman & Wakefield Research, Moody’s Analytics: Engineering News Record (ENR) (McGraw-Hill)

Building and construction input costs increased Skilled labor costs grew at an above-average rate
sharply after the pandemic, driven by material following the initial pandemic reopening, with a
shortages caused by supply chain issues compound annual growth rate (CAGR) of 2.9%
alongside sustained demand. Between October from 2021 to 2023 compared to 2% from 2017 to
2020 and October 2021, building costs rose 2019. As of October 2024, the Skilled Labor Index
by 14% and construction costs by 8%. As of (SLI) exhibited slower growth at 0.9% year-over-
October 2024, costs remain elevated, but the year (YOY), while common labor costs rose at a
rate of escalation has slowed drastically, with slightly higher rate of 1.8% YOY—0.4% above the
the Building Cost Index (BCI), Construction Cost annual growth from 2021 to 2023.
Index (CCI) and Skilled Labor Index (SLI) showing
lower growth rates over the past year.

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 DATA CENTER DEVELOPMENT COST GUIDE 2025

RISING CONSTRUCTION COSTS

UNITED STATES: DATA CENTER DEVELOPMENT BREAKDOWN Data Center Construction Costs Breakdown
Lead Time (Weeks) may require project managers to
adjust labor schedules, potentially
Switchgear 46 48
leading to increased labor costs
DC Shell due to extended work periods or
Chillers 30 40 ($/SF)
21% overtime. In addition, fluctuating
Generators 30 38
input costs during prolonged lead
CRAHS DM 28 36
Site ($/ times for materials and equipment
CRAHS ER 28 36 Developed frequently require budget revisions.
Pre Fab Skids 28 36 Acre)
10% For example, uninterruptible power
UPS 28 36 supplies (UPS) ordered at the end
CX Boards 28 36 of the third quarter in 2023 would
Transformers 28 36 White Space cost 15% more by their delivery
Buildout
PDUs 24 32 Critical ($/MW) 28-36 weeks later.
Capacity 10%
Battery Cabinets 24 32
($/MW) While lead times have improved
Copper Wire 23 25 53%
compared to the immediate post-
Steel 12 14
Back Of House pandemic years, they remain
Light Fixtures 11 13 ($/SF) elevated for certain materials
Glass 7 9 4%
critical to data center development.
Aluminium 5 7 Office Buildout Switchgear—essential for ensuring
($/SF)
Insulation 3 5 2% uninterrupted power supply, load
Lumber 1 3 balancing, fault protection and
PVC 1 3 overall operational stability of the
Plumbing 1 3
Most data center construction costs are attributed to building datacenter—has the longest lead
out the facility’s critical capacity, while office space accounts times, averaging 46-48 weeks.
Gypsum 1 3
for the least capital investment. Extended lead times affect Generators and chillers are also
Concrete 0 2
data center development by influencing scheduling, cost difficult to obtain, with lead times
variation and resource allocation. Prolonged lead times for exceeding 30 weeks and, in some
Source: Cushman & Wakefield Research, Turton Bond
materials or equipment can delay project timelines, causing cases, stretching up to 110 weeks. 2
a chain reaction across all construction stages. Such delays

HITT, DPR, and Clune, in addition to Turton Bond, have contributed data on construction materials, labor pricing, and lead
2

time data.
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 DATA CENTER DEVELOPMENT COST GUIDE 2025

CONSTRUCTION COSTS BY MARKET

SELECT MARKETS: DATA CENTER CONSTRUCTION COST PER MW

$16
$15.0
$15
$14.3 $14.2
$14.1
$13.9 $13.7
$14
$13.4 $13.4
$13.2
$13.0 $12.9
$13 $12.6 $12.4 $12.4
$12.3 $12.2
$12.1 $12.1 $11.9

Millions USD/MW
$12 $12.5

$11
$11.1 $11.1 $11.0 $10.8 $10.8
$10.6
$10 $10.4 $10.4
$10.1 $10.0
$9.8 $9.7 $9.7 $9.7
CONSTRUCTION COST COMPONENTS $9 $9.5 $9.4 $9.4 $9.3

$8
UNITED STATES: MATERIAL COST CHANGES

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Material Cost Changes Index (Q3 2021 = 100) Impact of Lead Time on Material Cost Index

Ph

O
sa

A
Po
he
N

V
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A
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La
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Fr

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C

C
W

Sa
lt
D

Sa
Sa
160 115 Low (U.S. $M/MW) Mid (U.S. $M/MW) High (U.S. $M/MW)

150 110 Source: Cushman & Wakefield Research, Turton Bond

140 105
46+ Weeks → +14%
28+ Weeks → +15%

30+ Weeks → +6%

30+ Weeks → +5%

28+ Weeks → +9%

28+ Weeks → +7%

130 100
Across 19 markets, the cost to develop one design/soft costs and owner-held contingencies.
120 95
megawatt (MW) of critical load varied from $15 Therefore, the affordability of land in markets
110 90 million in Reno on the high end to $9.3 million in like Des Moines and Reno was not factored in.
San Antonio on the low end, with an average of These two markets, however, faced inflated labor
PS

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$11.7 million. Texas emerged as a cost-effective expenses, largely due to the lack of skilled local
er
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C
en
X

Q3 2021 Q2 2022 Q1 2023 Q4 2023 Q3 2024

ns
Sw

option compared to other data center markets, labor, requiring developers to offer incentives and
G
a
Tr

Switchgear Generators Transformers

CX Boards UPS Chillers
Order Date Cost (Q3 2023) Cost After Lead Time as Dallas, Austin and San Antonio recorded cover travel expenses to bring in workers.
lower costs per MW than any of the other 16
Source: Cushman & Wakefield Research, Turton Bond Note: Indexed values – Q3 2023 = 100
markets analyzed. This cost advantage can be Virginia, home to the largest data center market,
Source: Cushman & Wakefield Research, Turton Bond
attributed to Texas’ business-friendly regulatory ranked as the seventh least expensive among the
environment, attractive incentive packages, 19 markets. Its data center-friendly environment
reasonable site acquisition costs and access to and long-standing industry presence have
Since the pandemic, strained supply chains (+45%), transformers (+44%), CX boards (+31%), affordable labor. fostered economies of agglomeration, where
have made materials acquisition difficult and UPS (+48%) and chillers (+40%). These price clusters of data center activity drive cost
more expensive. Since the third quarter of 2021, escalation0s, combined with elevated labor The construction cost analysis in the above chart efficiencies for developers, owners, operators and
switchgear prices have risen by 50%. This cost expenses, have directly driven up data center excluded typical owner-furnished contractor tenants, ultimately creating a competitive market.
surge extends to a variety of materials required development costs. installed (OFCI) equipment purchases, end user/
for data center construction, including generators tenant costs, operational costs, land acquisition,

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 DATA CENTER DEVELOPMENT COST GUIDE 2025

DATA CENTER LAND OVERVIEW

DATA CENTER LAND PRICING

NORTH AMERICA: DATA CENTER LAND TRANSACTIONS 2014-2024 NORTH AMERICA: DATA CENTER LAND TRANSACTIONS 2015-2024

Hyperscaler vs. Colocation Provider Pricing Established vs. Non-Established Markets

$1,000.00

$20 $20

$100.00

Weighted Avg ($ / SF)

Weighted Avg ($ / SF)
$15 $15

$10.00
$ / SF

$10 $10

$1.00
$5 $5

$0.10
$- $-

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024
2015

2016

2017

2018

2019

2020

2021

2022

2023

2024
$0.01
Nov-13 Apr-15 Aug-16 Jan-18 May-19 Oct-20 Feb-22 Jun-23 Nov-24 Hyperscaler Pricing Colocation Provider Pricing Established Markets Non-Established Markets

Note: Bubble size corresponds to acres sold Note: Data center land transactions with minimum 10 acres, Source: Cushman & Wakefield Research
Source: Cushman & Wakefield Research Hyperscalers = Apple, AWS, Google, Meta, Microsoft

Data center demand is heightened as AI, center markets and upward pressure on land Hyperscalers currently hold a significant acquired roughly 500 acres in Plano, Illinois, just
cloud storage and an increasingly digitalized values, interest has shifted toward rural areas advantage over many colocation providers in site west of Chicago.
world outpace the available market capacity, where suitable options are more abundant and acquisition due to their superior access to capital
confirming undersupply conditions are a norm affordable. Despite the interest in powered land, and ability to self-fund. This financial strength The capital advantage of hyperscalers is also
in the industry. Developers are turning to developers continue to acquire prime parcels in allows hyperscalers to outcompete colocation evident in their ability to secure highly sought-
emerging and tertiary markets with available strategic locations, with plans to secure power providers, especially for highly desirable after powered land sites. From 2022 to 2024,
land and power, while most established markets later through local utilities, renewable energy powered-land sites. By avoiding the impact of the cost of such sites (10 acres or more) for
face shortages of both. Major players in the farms or small modular reactors. higher interest rates, hyperscalers can make more hyperscalers rose from $2.89 psf to $5.38 psf
data center industry are aggressively pursuing attractive offers while still seeking ways to reduce as demand for data centers continues to grow
larger parcels, especially those with power As a result, average U.S. data center land prices costs. This has driven their focus to the outskirts in the generative AI era. In contrast, colocation
commitments in place, to accommodate future for parcels 50 acres or larger have increased 23%, of established markets and into emerging providers have seen the weighted average cost
expansion and capture pent-up demand. With from $4.39 per square foot (psf) in 2023 to $5.40 markets where land and power availability are less of comparable land fall from $14.10 psf in 2022
limited suitable options in dominant data psf in 2024 through October.1 constrained, helping to stabilize average prices. to $5.68 psf in 2024. The higher prices paid by
For example, AWS recently purchased over 1,000 colocation providers often reflect their acquisition
acres in Fredericksburg, Virginia, while Microsoft of higher-value land in more urban environments.

Land price data is based on a wide swath of geographies, where site plan is approved, or special exception is approved
1

for rezoning.

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 DATA CENTER DEVELOPMENT COST GUIDE 2025

SITE ACQUISITION COST RANGE DATA CENTER PARCEL SIZE

SELECT MARKETS: LAND PRICING RANGE (2022-2024) NORTH AMERICA: DATA CENTER LAND TRANSACTIONS 2015-2024

Average Parcel Size Acquired Parcel Size Acquired by Market Type

Established Markets Emerging Markets
$35

1,200 1,200
$30

1,000 1,000
$25

800 800
$20
$ / SF

Acres

Acres
600 600
$15

400 400
$10

200 200
$5

- -

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024
$-
Chicago Phoenix Virginia Atlanta Columbus Carolinas Oregon Iowa Indiana Minneapolis <2021 2021 2022 2023 2024
Median $35.08 $22.50 $18.86 $8.04 $3.56 $1.17 $0.92 $2.61 $1.91 $1.38
Weighted Avg $11.85 $20.08 $9.06 $5.93 $4.24 $1.33 $1.49 $2.47 $3.10 $1.63 Acres Acquired Avg Parcel Size Established Markets Emerging + Tertiary Markets

Note: Established and emerging markets with few transactions not displayed Note: Site acquisitions overs 1,200 acres not shown Source: Cushman & Wakefield Research
Source: Cushman & Wakefield Research Source: Cushman & Wakefield Research

Despite market expansion, densely populated However, their urban locations and limited As securing ample power resources becomes 190 acres in established markets and 340 acres in
established markets still command a premium availability often lead to fierce competition from more challenging, buyers are increasingly drawn emerging and tertiary markets.
compared to emerging and tertiary geographies. buyers outside the data center industry, further to sites capable of accommodating future
These markets offer several advantages, including driving up prices. Markets like San Francisco, expansion. In line with this trend, the average size The rise of AI has further boosted the appeal of
dense and diverse fiber networks, low latency, Phoenix and Northern Virginia often outprice of data center sites has grown over the past three emerging and tertiary markets for data center
robust infrastructure and generous government more rural markets in the Midwest. In-market years. As of October 2024, the average acquired operations. While these markets often have
incentives. Urban data centers benefit from hubs like Elk Grove Village in Chicago remain parcel spans 224 acres—a 144% increase since slightly higher latency, ultra-low latency is not
close proximity to end users, reducing latency hotspots for data centers, commanding a 2022. This trend toward larger parcels is present always a necessity for AI users, unlike edge data
and making them ideal for applications like premium over other regional sites. Over the past in both emerging and established markets, with center applications.
autonomous vehicles, IoT, content delivery, three years, the median price of land in Chicago average acreage site sizes this year reaching
financial trading, gaming and healthcare. has been more than 13 times higher than in Iowa.

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 DATA CENTER DEVELOPMENT COST GUIDE 2025

LABOR
DATA CENTER LABOR AVAILABILITY

UNITED STATES: DATA CENTER-RELATED OCCUPATIONS

Electrical Engineers & Technicians

Portland
7K 2.7
Austin
6K 2.5
Seattle
10K 2.4
San Francisco
8K 1.8
Kansas City
4K 1.8
Reno 1.8
Denver 5K 1.7
Boston 8K 1.6
Dallas 13K 1.6
Salt Lake City 2K 1.6
Columbus 3K 1.5
Phoenix 8K 1.5
Charlotte 4K 1.5
Minneapolis 5K 1.4
Washington DC 9K 1.4
Los Angeles 17K 1.4
Indianapolis 3K 1.2
Des Moines 1.2
Las Vegas 3K 1.1
1.1
Wenatchee
2K 1.1
Nashville
6K 1.0
Atlanta
18K 0.9
New York
8K 0.9
Chicago
Total Resident Workers Resident Workers Per 1,000 Capita

Source: Cushman & Wakefield Research, Lightcast

The rapid proliferation of data centers across North America has strained access to both power and
the specialized labor pool needed to build and operate these facilities. In some markets, securing an
adequate workforce has become a challenge. Given the high capital expenditure required to develop
these facilities, it’s important that companies ensure talent availability and mitigate labor risks to avoid
prolonged construction timelines and unexpected labor costs increases.

Among the top 24 U.S. data center markets, New York claimed the largest labor force in three of the
four workforce categories analyzed, while Wenatchee, Washington, with a much smaller population, had
the smallest. However, on a per capita basis, New York ranked among the bottom five across categories
despite its high absolute numbers. Austin led in resident workers per capita, followed by Denver and Des
Moines. Larger metros like New York, Los Angeles and Chicago struggled with per capita talent, with
Austin nearly doubling their talent per capita. Overall, construction workers were the most abundant, with
over 757,000 resident workers across the 24 markets, followed by information technology (407,000),
technicians (227,000) and electrical engineers and technicians (153,000).

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 DATA CENTER DEVELOPMENT COST GUIDE 2025

DATA CENTER LABOR AVAILABILITY

UNITED STATES: DATA CENTER-RELATED OCCUPATIONS

Information Technology Technicians

Austin Portland
15K 6.1 11K 4.3
Washington DC Austin
38K 6.0 9K 3.7
Seattle Seattle
23K 5.7 13K 3.1
Des Moines Minneapolis
5.5 11K 3.1
Denver Salt Lake City
16K 5.4 4K 3.0
Columbus 11K 5.1 Reno 3.0
Charlotte 14K 4.9 San Francisco 12K 2.7
Kansas City 10K 4.7 Boston 13K 2.7
Indianapolis 10K 4.7 Kansas City 6K 2.6
Minneapolis 17K 4.5 Denver 8K 2.5
Dallas 36K 4.4 Columbus 5K 2.4
San Francisco 19K 4.1 Phoenix 12K 2.3
Boston 19K 3.9 Des Moines 2.3
Portland 9K 3.4 Dallas 18K 2.2
Nashville 7K 3.3 Charlotte 6K 2.2
Phoenix 16K 3.2 Washington DC 13K 2.0
Atlanta 20K 3.2 Los Angeles 25K 2.0
Chicago 30K 3.1 Indianapolis 4K 2.0
Salt Lake City 2.9 Wenatchee 1.7
55K 2.7 3K 1.6
New York Nashville
29K 2.3 4K 1.6
Los Angeles Las Vegas
2.2 14K 1.5
Wenatchee Chicago
1.8 9K 1.4
Las Vegas Atlanta
1.8 24K 1.2
Reno New York
Total Resident Workers Resident Workers Per 1,000 Capita Total Resident Workers Resident Workers Per 1,000 Capita

Source: Cushman & Wakefield Research, Lightcast Source: Cushman & Wakefield Research, Lightcast

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 DATA CENTER DEVELOPMENT COST GUIDE 2025

DATA CENTER LABOR AVAILABILITY

UNITED STATES DATA CENTER MARKETS: MEDIAN HOURLY LABOR COST

Columbus; $44 San Francisco; $63

Information Technology Nashville; $42 Denver; $51
Reno; $39 Seattle; $60

Dallas; $35 San Francisco; $57

Electrical Engineers & Nashville; $36 Minneapolis; $45
Technicians
Reno; $31 Seattle; $56

Dallas; $33 San Francisco; $49

Technicians Nashville; $32 Kansas City; $41
Reno; $31 Seattle; $52

Dallas; $25 San Francisco; $45

Construction Nashville; $25 Minneapolis; $39
Construction
Wenatchee; $31 Boston; $42

$10 $20 $30 $40 $50 $60 $70 $80

Salt Lake City
15K 12.2 Established Emerging Tertiary
Reno
11.7
Denver
34K 11.2 Note: Geographies limited to established, emerging and tertiary data center markets
Des Moines Source: Cushman & Wakefield Research, Lightcast
11.0
Charlotte
28K 10.2
Phoenix 50K 9.9
Austin 24K 9.6
Indianapolis 19K 8.7 The high demand for data center occupations has U.S. cities, ranked as the costliest market in every
Wenatchee 8.6 intensified competition for the specialized talent labor segment except technicians, while nearby
Nashville 18K 8.5
needed to run these facilities, driving wages Reno offered the lowest wages in all categories
Las Vegas 19K 8.3
Dallas 67K 8.1
higher. Although data centers don’t command except construction.
Seattle 32K 7.9 a large labor force to maintain operations, the
need for 24/7 coverage increases workforce Overall, labor costs in San Francisco were 30%
Portland 19K 7.7
Kansas City 17K 7.5 requirements and, ultimately, labor costs. The above the average, reflecting the region’s higher
Minneapolis 28K 7.4 diverse geographies where these assets are being cost of living and competition for technology
Columbus 16K 7.2
developed results in varying labor costs across talent from Silicon Valley. Conversely, Reno
Washington DC 46K 7.1 provided an 18% cost advantage for local labor.
35K 7.1
occupational segments. However, across markets,
Boston
internet technology professionals consistently Unsurprisingly, established markets reported
39K 6.2
Atlanta higher labor costs compared to emerging and
San Francisco
27K 5.9 command the highest compensation across
52K 5.5 markets, with hourly wages ranging from $39 to tertiary markets. 3
Chicago
100K 4.9
New York $63. San Francisco, one of the most expensive
59K 4.6
Los Angeles
Total Resident Workers Resident Workers Per 1,000 Capita

Source: Cushman & Wakefield Research, Lightcast Availability of labor significantly impacts cost. In some markets, utility/technician tradesmen are in short supply and are
3

experiencing an aging workforce.

18 Cushman & Wakefield 19

CONTACTS
JOHN McWILLIAMS
Head of Data Center Insights, Research Manager
[email protected]

ETHAN TRIBBLE
Research Analyst, Global Research
[email protected]

ADRIAN CONFORTI
Northeast Region PDS Lead
[email protected]

JASON D’ORLANDO
Industrial, Life Sciences, and Mission Critical Lead,
Project & Development Services
[email protected]

About Cushman & Wakefield

Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for
property owners and occupiers with approximately 52,000 employees in nearly 400 offices
and 60 countries. In 2023, the firm reported revenue of $9.5 billion across its core services of
property, facilities and project management, leasing, capital markets, and valuation and other
services. It also receives numerous industry and business accolades for its award-winning culture
and commitment to Diversity, Equity and Inclusion (DEI), sustainability and more. For additional
information, visit www.cushmanwakefield.com.