Intelligent Investment
Chicago
North America Data Center Trends H1 2023
September 6, 2023 4 Minute Read
Colocation Insights
- Demand continues to grow from technology, finance and healthcare sectors.
- Hyperscalers are driving a large majority of demand.
- Oracle and Microsoft show strong potential for continued regional growth.
Market Trends
- Land prices continue to steadily rise despite macroeconomic conditions and increased interest rates.
- Lead times are lengthening for power in the data center corridor. Some sites require up to five years for power delivery. The Elk Grove Village area substations have limited distribution/bridging power. As a result, ComEd is leading a site search for a new substation position, while collaborating with multiple developers on on-site substation developments.
- Land availability is constrained so data center operators are continuing to seek creative solutions that involve rezoning, assemblages of office properties or pioneering new submarkets.
Notable Activity
- Aligned Data Centers, Stream Data Centers and Nexstar Media Group/IPI are each planning data center campuses in the Elk Grove area.
- Edged Energy began construction on a new data center in Aurora, a city in the Chicago metro area’s western region.
- Microsoft acquired 30 more acres of land in the Hoffman Estates area.
Figure 1: Historical Market Information
Source: CBRE Research, CBRE Data Center Solutions, H1 2023.
Figure 2: Historical Supply and Demand
Source: CBRE Research, CBRE Data Center Solutions, H1 2023.
Figure 3: % of Total Primary Market Inventory
Source: CBRE Research, CBRE Data Center Solutions, H1 2023.
Figure 4: Market Fuel Mix
Source: ComEd.
Figure 5: Average Asking Rates
Source: CBRE Research, CBRE Data Center Solutions, H1 2023.
Explore Markets
-
A majority of new development has been preleased to hyperscale providers.
-
Digital Realty is conservatively approaching new construction.
-
Strong demand and immediate online supply constraints enabled Northern Virginia to set a record low 0.94% vacancy rate.
Report Contacts
Related Service
- Property Type
Data Center Solutions
Optimize your data center real estate with worldwide consulting, advisory and transaction, project management an...