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This exclusive data center report was prepared by °µÍø½ûÇøConnect Chief Economist, , and Associate Economist, .

Data Center °µÍø½ûÇøion Starts Spending

January 2026 marked a historic milestone for data center construction, with starts totaling $25.2 billion, the highest monthly figure since recordkeeping began in 2020. This surge included on 20  across the country.

Among the largest projects were two massive developments, each valued at $10 billion, alongside two others with  of $1.8 billion and $1.3 billion, respectively.

This record-breaking month elevated the trailing twelve-month spending total to $103.7 billion, with an average monthly expenditure of $8.6 billion over the same period.

The relentless  has driven  sharply higher over the past five years. From a mid-point estimate of $183 per square foot in 2020, costs have surged to $415 per square foot in 2025, a compounded annual growth rate of nearly 18%.

If this trend continues, the mid-point estimate for 2026 is projected to reach $488 per square foot.

Where US Data Center Starts Activity Occurred

Geographically, January 2026  was heavily concentrated along the East Coast, where $12.2 billion in starts were allocated from New York through to South Carolina.

The Midwest also saw significant investment, with another $12.2 billion allocated across Minnesota, Illinois, Michigan, and Ohio. The remaining $800 million was focused west of Minnesota, primarily in Texas and Arizona.

°Â³ó¾±±ô±ðÌýremains widespread across the U.S., the Southeast continues to dominate as the preferred region for new projects, driven by favorable and regulatory conditions.

Data Center Project Pipeline

The near-term outlook for data center construction remains strong, with a significant pipeline of projects that could sustain the current momentum.  65 projects, collectively valued at $92.1 billion, with potential start dates within the next six months. 

However, it’s important to note that these projects are in various  and are not guaranteed to break ground.

Geographically, the Southern census region continues to dominate, mirroring the distribution of recent groundbreaking activity.

Over 56% of the near-term potential spending is concentrated in the South, followed by the Midwest at 26.7%.

The Northeast and West trail significantly, accounting for 14.7% and 2.3% of the pipeline, respectively.

Data Centers and Power Infrastructure

°ä´Ç²Ô²õ³Ù°ù³Ü³¦³Ù°ä´Ç²Ô²Ô±ð³¦³ÙÌý³Ù³ó²¹³ÙÌý will reach record levels in 2026, with further acceleration expected in the coming years.

This projection aligns with the latest Preliminary Monthly Electric Generator Inventory report from the , which indicates that U.S. power plant developers and operators plan to add  generating capacity to the grid in 2026, a record-breaking figure.

This unprecedented scale of power investment is vital to meeting the of the rapidly expanding data center sector. As development accelerates, ensuring adequate power capacity will be essential to sustaining growth.