Vacancy Hits Record Low as Cloud Giants Push into Secondary Markets Worldwide
Record-breaking demand from hyperscalers and cloud providers drove data center leasing volumes to new highs in the first quarter of 2025, fueled by the global AI boom and tightening power supply, according to CBRE’s latest Global Data Center Trends report.
Vacancy rates across global data centers fell to a record low of 6.6%, down 2.1 percentage points year-over-year, as major tech players scrambled for capacity. The squeeze in top-tier hubs forced large users to expand into secondary markets such as Richmond, Virginia; Santiago, Chile; and Mumbai, India.
“Rising demand from AI and hyperscale users is shrinking vacancy, and operators with capacity in core markets are commanding premium pricing,” said Pat Lynch, Executive Managing Director at CBRE. “Emerging markets are now central to global deployment strategies.”
U.S. Leads Construction, Tightest Vacancy
North America posted the most aggressive expansion, with a 43% year-over-year increase in data center inventory. Northern Virginia retained its position as the region’s largest market, while Atlanta and Phoenix overtook Dallas and Silicon Valley to claim the No. 2 and No. 3 spots.
Vacancy in North America dropped to just 2.3%, the lowest globally. Europe followed at 7.4%–a record low for the region–while Latin America declined to 8.8%. Asia-Pacific, hindered by land and power shortages, averaged a 14% vacancy rate, though Singapore stood out with just 2% amid tight regulations and strong demand.
“Legacy markets face mounting power constraints, prompting hyperscalers to diversify workloads into regions with faster power delivery,” said Gordon Dolven, Director of CBRE Americas Data Center Research. “It’s no longer about latency–it’s about where you can scale.”
Leasing Doubles in North America, Rates Rise
Net absorption in North America hit 1,668.5 megawatts (MW) over the past year, doubling the prior-year figure, thanks to aggressive hyperscaler expansion and improved power infrastructure. Europe followed with 300.4 MW–its second-highest total ever.
Latin American absorption rose to 99.9 MW in Q1, up from 73.3 MW a year earlier, though energy restrictions limited gains in cities like Querétaro and Bogotá. Asia-Pacific saw Tokyo lead the region in leasing at 49.8 MW, while markets such as Sydney, Melbourne, and Johor, Malaysia are positioned for AI-driven growth.
Rental rates increased across North America and Europe due to limited supply and elevated construction costs. However, Santiago and São Paulo saw rate declines amid rising availability. In contrast, markets with power scarcity–like Querétaro–saw rents climb. Asia-Pacific pricing remained largely steady.
New Hotspots Emerge
CBRE highlighted emerging data center hubs benefiting from available power, fiber connectivity, and new builds. In North America, Des Moines and Richmond are attracting major interest. Brussels and Zurich are gaining ground in Europe, while Rio de Janeiro, Fortaleza, Mumbai, and Seoul are rising contenders in Latin America and Asia-Pacific.
The report, which covers trends across 16 global markets, points to a structural realignment in digital infrastructure as the AI wave accelerates and energy bottlenecks reshape global deployment strategies.
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