A version of this article first appeared in the CNBC Property Play newsletter with Diana Olick. Property Play covers new and evolving opportunities for the real estate investor, from individuals to venture capitalists, private equity funds, family offices, institutional investors and large public companies. Sign up to receive future editions, straight to your inbox. Data center construction is expanding at such a rapid pace across North America that the majority of new build in the sector is now expanding beyond the initial, traditional markets. Texas is about to unseat Virginia as the world’s largest data market, according to a new report from JLL, which calls it an “inflection point.” About 64% of the 35-gigawatt construction pipeline now extends beyond so-called mature markets, like Virginia, which has long been the largest data center market. Data center vacancies at the end of 2025 remained at a historic low of 1% for the second year in a row. “The data center sector has officially entered hyperdrive,” said Andy Cvengros, executive managing director and co-lead of U.S. data center markets at JLL. “Record-low vacancy sustained over two consecutive years provides compelling evidence against bubble concerns, especially when nearly all our massive construction pipeline is already pre-committed by investment-grade tenants.” Almost all, 92%, of the capacity currently under construction is pre-committed, which indicates that vacancy is likely to remain quite low at least through 2030, according to JLL. The demand is now being driven by hyperscalers and artificial intelligence, and headwinds to new development are keeping construction less robust than it could be. JLL also noted that the t …
