CRE Daily
Posts
AI’s Data Center Boom Is Becoming America’s Biggest Infrastructure Bet

AI’s Data Center Boom Is Becoming America’s Biggest Infrastructure Bet

The $10.3T AI infrastructure build-out is creating massive opportunities across the economy, while introducing new financial, energy, and development risks.

Nina Dale
September 25, 2026

In partnership with

Good morning. Data centers are moving from a niche CRE sector to a major economic force. The AI infrastructure boom is redirecting capital, construction activity, and power capacity on an unprecedented scale.

🎙️ This Week on No Cap: Trinity's CEO Sean Hehir on why his firm refuses to play the cap-rate arbitrage game. (Thanks to our sponsor, Warespace)

CRE Trivia 🧠

What was the first fully air-conditioned high-rise office building in the world, opening in January 1928 in San Antonio, TX?

IN PARTNERSHIP WITH 1031 CROWDFUNDING, LLC

Close on Your 1031 Exchange Replacement Property in Days, Not Months

Missing your 1031 exchange deadline isn't an option. With Delaware Statutory Trusts (DSTs), accredited investors can identify and close on a replacement property in as few as 3-5 days.

Explore a curated inventory of institutional-quality DST offerings on the 1031 Crowdfunding platform:

70+ DST offerings across asset classes — multifamily, industrial, medical office, and more
Institutional-quality real estate with minimums starting at $25,000
2,800+ exchanges completed by our experienced team

*DSTs are not suitable for all investors. Please consult your tax professional and financial advisor to determine if a DST investment is right for you. Investments offered by Capulent LLC, member FINRA/SIPC. This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.

Market Snapshot

S&P 500

GSPC

7,704.13

Pct Chg:
-0.025%

FTSE NAREIT

FNER

804.05

Pct Chg:
-0.30%

10Y Treasury

TNX

5.204%

Pct Chg:
+0.09%

CME Term SOFR

1-Month

3.90%

Pct Chg:
-0.00

*Data as of 09/24/2026 market close.

Building AI

AI’s Data Center Boom Is Becoming America’s Biggest Infrastructure Bet

The AI race is turning data centers into an economic force that could eclipse America’s railroad, highway, and electrification booms.

By the numbers: U.S. investment in data centers and AI infrastructure is projected to reach $10.3T from 2025 to 2032, or roughly 3.6% of GDP annually, according to economist Stijn van Nieuwerburgh. Goldman Sachs estimates AI investment alone will hit 1.9% of GDP in 2026.

Construction’s new growth engine: Through July, private data-center construction spending reached $37B, up about $9B year over year. Meanwhile, other private construction spending fell roughly $46B, as data centers increasingly compete for workers, land and power.

Trillions—and more debt: Alphabet, Amazon, Meta, Microsoft and Oracle are expected to spend $4.2T on capital expenditures over the four years ending in 2029. More of that spending is being financed with debt, raising financial risks if AI revenues ultimately fall short of expectations.

A labor-market bright spot: AI generated more than 750,000 U.S. jobs from 2023 through 2026 to date, according to LinkedIn, with AI-related listings paying a median $180,000. Data centers have added another 117,000 jobs since early 2024, while demand for skilled trades is pushing wages higher.

The ripple effects: AI-fueled stock gains are boosting wealth and luxury housing demand, but the boom is also raising costs. Surging demand for chips, electricity, workers, and equipment is contributing to shortages, higher power bills, and inflationary pressure.

➥ THE TAKEAWAY

AI is increasingly a real estate and infrastructure story: Data centers are redirecting enormous amounts of capital, labor, land, and electricity—creating opportunities across CRE while making power availability and development costs increasingly important investment considerations.

A MESSAGE FROM AIRGARAGE

The Overlooked Revenue Stream

Parking is often treated as a maintenance expense instead of an income-producing asset.

Learn how smarter pricing, demand management, and customer mix can unlock new parking revenue without major capital investment.

Can’t attend live? Register, and we’ll send the recording.

*This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.

✍️ Editor’s Picks

Claude now sources CRE deals: Terrakotta's Claude Agent is disrupting the CRE industry as we speak. Brokers can now automate LLC skip-tracing, find motivated sellers, and source off-market deals. (sponsored)
Hard assets: Alternative investment fundraising reached $119B through August, with real estate and infrastructure raising $38.9B and surpassing credit strategies as investors shifted toward hard assets.
Bond pressure: U.S. 30-year Treasury yields hit 5.46%, the highest since 2004, as rising oil prices, inflation concerns and heavy government borrowing pushed global bond yields higher.
MLS pullback: Invitation Homes has largely stopped buying homes through the MLS as high prices limit returns, shifting capital toward build-to-rent, M&A and selective renovation opportunities.

🏘️ MULTIFAMILY

Density bill: California’s AB 2074 could allow taller residential buildings in seven major cities, requiring transit districts to permit heights of at least 150 feet.
Columbus rents: Columbus multifamily rent growth reached 0.6%, while construction starts are projected to fall 48.8% as supply pressures ease, supporting stronger occupancy and rents.
Austin rebound: Austin multifamily rents rose 1.8% in Q2 to $1,316 as slowing deliveries and declining vacancy signal a gradual market recovery, though concessions remain elevated.

🏭 Industrial

Storage concentration: Just 12 sponsors control 50.6% of $24.02B in securitized self-storage debt, with refinancing risk increasingly concentrated among the largest borrowers through 2028.
Supply recovery: Self-storage deliveries are projected to fall 19.6% in 2026, helping absorb excess inventory as major operators report improving occupancy and revenue trends.
Distribution refi: Family Dollar owners secured a $455.7M floating-rate refinancing for 7.1M SF of distribution centers across eight states, supporting operational improvements following the retailer’s 2025 acquisition.

🏬 RETAIL

Retail squeeze: U.S. retail demand is accelerating, with 127 net store openings and 10.2M SF of positive absorption, while construction remains constrained by rising costs and limited supply.
McDonald’s investment: McDonald’s plans $8.5B through 2036 to support franchisees with restaurant modernization, technology and operational upgrades, targeting stronger efficiency and traffic.
Oakbrook refinance: Brookfield’s GGP secured an $800M CMBS refinancing for Oakbrook Center, replacing $700M of debt and returning approximately $65M of equity to sponsors.

🏢 OFFICE

Meeting costs: Meeting rooms account for roughly 40% of coworking costs for larger teams, with a weekly two-hour meeting costing about $4,700 annually at median rates.
Office pressure: U.S. office vacancy fell to 17.8%, but $289.2B in maturing loans through 2028 could intensify refinancing challenges in high-vacancy markets.
Houston offices: Houston office vacancy climbed to 24.1%, while $1.5B in sales and 2.3M SF under construction signal continued investment despite elevated availability.

🏨 HOSPITALITY

Luxury cabins: Sevier County’s luxury market surged 180% over the past decade, fueled by tourism and high-end vacation cabins tied to the Great Smoky Mountains.
Resort expansion: Fort Partners acquired the 134-room Tideline Palm Beach for at least $112.6M, expanding its South Florida footprint next to its Four Seasons resort in Palm Beach.
School revival: A $14M conversion transformed two historic Fayetteville school buildings into the 40-room Hill Hall Hotel, blending heritage design with growing tourism demand.

📈 CHART OF THE DAY

The top 10 metros added 290,300 jobs in August, down sharply from 349,400 in July, with New York still leading, though its monthly gain fell to 50,300 jobs.

CRE Trivia (Answer)🧠

The Milam Building. George Willis designed the 21-story tower using a Willis Carrier "Manufactured Weather" system that cooled every floor from day one.

AI’s Data Center Boom Is Becoming America’s Biggest Infrastructure Bet

The $10.3T AI infrastructure build-out is creating massive opportunities across the economy, while introducing new financial, energy, and development risks.

CRE Trivia 🧠