Data Center Development Cost Guide 2025

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

600

600

$ / SF

$15

Acres

Acres

400

400

$10

200

200

$5

-

-

$-

2022

<2021

2023

2024

2021

Chicago Phoenix Virginia Atlanta Columbus Carolinas Oregon Iowa

Indiana Minneapolis

$35.08 $22.50 $18.86 $8.04 $3.56

$1.17

$0.92 $1.49

$2.61 $2.47

$1.91 $3.10

$1.38 $1.63

Median

2017

2021

2015

2018

2019

2016

2022

2023

2024

2020

Acres Acquired Avg Parcel Size

Established Markets Emerging + Tertiary Markets

$4.24 $1.33

Weighted Avg $11.85 $20.08 $9.06 $5.93

Note: Established and emerging markets with few transactions not displayed Source: Cushman & Wakefield Research

Note: Site acquisitions overs 1,200 acres not shown Source: Cushman & Wakefield Research

Source: Cushman & Wakefield Research

Despite market expansion, densely populated established markets still command a premium compared to emerging and tertiary geographies. These markets offer several advantages, including dense and diverse fiber networks, low latency, robust infrastructure and generous government incentives. Urban data centers benefit from close proximity to end users, reducing latency and making them ideal for applications like autonomous vehicles, IoT, content delivery, financial trading, gaming and healthcare.

However, their urban locations and limited availability often lead to fierce competition from buyers outside the data center industry, further driving up prices. Markets like San Francisco, Phoenix and Northern Virginia often outprice more rural markets in the Midwest. In-market hubs like Elk Grove Village in Chicago remain hotspots for data centers, commanding a premium over other regional sites. Over the past three years, the median price of land in Chicago has been more than 13 times higher than in Iowa.

As securing ample power resources becomes more challenging, buyers are increasingly drawn to sites capable of accommodating future expansion. In line with this trend, the average size of data center sites has grown over the past three years. As of October 2024, the average acquired parcel spans 224 acres—a 144% increase since 2022. This trend toward larger parcels is present in both emerging and established markets, with average acreage site sizes this year reaching

190 acres in established markets and 340 acres in emerging and tertiary markets. The rise of AI has further boosted the appeal of emerging and tertiary markets for data center operations. While these markets often have slightly higher latency, ultra-low latency is not always a necessity for AI users, unlike edge data center applications.

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Cushman & Wakefield