U.S. data center vacancy hit a record low of 1.4% in the first half of 2026, as artificial intelligence demand absorbed newly built capacity faster than developers could complete it, according to CBRE’s North America Data Center Trends report released August 27. The tightness reflects an intensifying squeeze in the market, where occupiers are competing fiercely for limited contiguous power blocks and available floor space.
Primary market vacancy fell from 1.6% in H1 2025, marking the second consecutive year of record-low availability despite a 33.7% year-over-year surge in supply. CBRE data showed net absorption across primary markets increased 11.7% year-over-year to 1,456.2 megawatts in H1, with hyperscale and AI operators driving the demand. All requirement sizes saw pricing gains as competition intensified; average rental rates for 3-to-10 megawatt deployments rose 8.3% in the first half alone.
The market tightness reflects a dramatic reversal from the past decade. Data center vacancy rates plummeted from 12.5% in 2017 to the current record low, according to corporate real estate industry tracking. The sustained low vacancy despite record construction underscores the structural demand shift: AI workloads are consuming capacity at a pace that outstrips even aggressive development timelines.
Developers raced to convert secured power positions into deliverable capacity, with under-construction capacity across primary markets reaching a record high of 7,481.1 megawatts in H1 2026, up 24.8% from the prior period. Atlanta overtook Northern Virginia as the top market for total construction, with under-construction capacity surging 52.3% year-over-year to 2,882 megawatts. Northern Virginia, the largest market by total inventory at 4,496.5 megawatts, reduced its vacancy rate to just 0.2%.
Preleasing activity accelerated, with commitments made on 80.4% of all under-construction capacity, compared with 74.3% a year earlier. However, less than 1,500 megawatts of future capacity across all primary markets remains available—equivalent to approximately six months of demand at the current absorption rate, according to CBRE.
Power and Infrastructure Emerge as the Real Constraint
Power availability and infrastructure delivery timelines have become the most decisive factors in site selection, leasing activity, and pricing, CBRE found. U.S. data center power demand is projected to climb from 31 gigawatts in 2025 to 41 gigawatts in 2026 and 66 gigawatts in 2027, according to Goldman Sachs analysis published in May 2026. That explosive growth is straining the electrical grid.
Gartner projects that 40% of AI data centers will be power-constrained by 2027, while analysts at Sightline Climate estimate that between 30% and 50% of AI data centers planned for deployment in the U.S. in 2026 face delays or cancellations due to grid interconnection queues and equipment shortages. The constraints extend beyond power: local opposition and zoning delays have become serious obstacles, with community resistance now as critical to site selection as power and fiber availability, CBRE reported.
Despite the supply-side challenges, JLL’s North America Data Center Report, released August 11, projects that vacancy will remain near zero through 2028. The market is locked in a structural squeeze where demand growth from AI continues to outpace the ability to deliver new capacity, keeping data center moratoriums spreading to 18 states as communities push back on development. Rental rates are expected to remain elevated as occupiers compete for the limited available space.
Sources
- CBRE — North America Data Center Trends H1 2026 report (August 27, 2026); vacancy rate at 1.4%, supply surge, net absorption, pricing gains, under-construction capacity, preleasing activity, power constraints, and regional market details.
- JLL — North America Data Center Report Midyear 2026 (August 11, 2026); vacancy projection through 2028.
- Goldman Sachs — U.S. data center power demand projections (May 20, 2026); power demand forecast to 66 GW by 2027.
- Sightline Climate — Analysis of 2026 data center delays and cancellations; 30–50% of planned capacity facing delays due to grid and equipment constraints.
- Gartner — Power-constraint forecast for AI data centers by 2027; 40% projected to be power-constrained.
- Corporate Real Estate Advisor (LinkedIn) — Historical vacancy rate data; rates fell from 12.5% in 2017 to 1.6% by 2025.
