AI data centre projects boost US warehouse demand and rents, real estate company JLL says
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Average asking rents rose to US$10.55 (S$13) per square foot, up 3.2% from a year earlier.
PHOTO: REUTERS
- AI data centre projects in Dallas/Fort Worth and Washington, DC, are boosting warehouse demand, JLL said.
- Big tech firms like Alphabet, Microsoft, Meta and Amazon are spending billions on AI, which needs heavy power and cooling.
- Average asking rents rose to US$10.55 per square foot, up 3.2% year on year, as infrastructure-related tenants increased.
AI generated
LOS ANGELES – AI data centre construction projects, particularly near Dallas/Fort Worth and Washington, DC, are generating new demand for warehouse space and helped send rents higher in the third quarter, real estate services company JLL said on Oct 20.
Companies such as Alphabet, Microsoft, Meta and Amazon are spending billions of dollars in a race to dominate artificial intelligence, which requires significant electricity to run servers and computer chips that must be cooled to prevent overheating.
“Data centre expansion is driving outsized industrial demand in major freight hubs such as Dallas/Fort Worth, where suppliers and infrastructure providers are clustering near hyperscale campuses,” JLL said in its industrial real estate market report for the third quarter.
Average asking rents rose to US$10.55 (S$13) per square foot, up 3.2% from a year earlier, the fastest annual pace of growth since the second quarter of 2024, JLL said.
That growth is based on so-called triple-net leases, where tenants pay property taxes, insurance and upkeep of common areas separately from base rent.
The expansion of infrastructure-intensive industries is changing the mix of tenants and the location of demand, JLL said, noting that demand from construction, telecommunications and utilities-related tenants increased. REUTERS