US Data Center Renovation Market

US Data Center Renovation Market Size

The US data center renovation market was valued at USD 8.9 billion in 2024. The market is expected to grow from USD 9.9 billion in 2025 to USD 44.7 billion in 2034 at a CAGR of 18.2%, according to latest report published by Global Market Insights Inc.

The market for owned data center renovations in the United States is experiencing unprecedented growth due to the convergence of increased artificial intelligence workloads, outdated infrastructure, and mandatory energy efficiency requirements. In 2023, US data center electricity consumption soared to 176 TWh, representing 4.4% of total US electricity usage, and is projected to grow to somewhere between 325-580 TWh in five years.

US data center electricity demand is expected to increase 15.8% by 2029, and workloads are expected to increase by 10% per year. Projected energy use could double or even triple to as much as 160% by 2030 because of increased artificial intelligent workloads and growth in cloud computing. More than 40% of the $7 trillion global capital expenditure will be spent on addressing the legacy facilities in the United States.

Federal Demand Side Management programs, such as the FDCCI, and energy efficiency improvements are designed to encourage or simply mandate in some cases upgrades to the outdated infrastructure. Legacy facilities do not have the capacity to support the new artificial intelligence workload demands, especially concerning both power and cooling capacity, and we are now seeing the start of large-scale upgrades and renovation initiatives.

Federal and state regulations are beginning to impose stricter data center energy efficiency requirements; and provide incentives for greater usage of renewable power usage. Several programs and executive orders promoting energy efficiency reporting, carbon emissions reductions, and greater levels of carbon free compliance are in the process of being rolled-out through the data center retrofit process. More than 20 states have already proposed legislation addressing the sourcing and purchasing of energy to transparency efforts to emissions reduction legislation.

US Data Center Renovation Market Trends

In US, 22 states presented 65 bills focusing on improving data center sustainability, through renewable energy requirements and emissions standards. The facilities are continuously retrofitted with renewable energy systems, water-free cooling and circular economy practices to comply with these stricter regulations and goals of long-term carbon neutrality.

The use of modular and prefabricated systems is increasing to reduce downtime and to allow scaling to the needs of the facility. More than half of IT budgets now go toward modernization initiatives. Modular systems help reduce the risks of service interruptions and expedite timelines for at least part of the deployment process during data center modernization and expansion.

AI data center management tools can improve energy efficiency through predictive maintenance, automated cooling, and workload balancing. These technologies enhance PUE and reliability while also addressing shortfalls with current data center systems, as a number of operators complain about deficient controls for the environment, power, and cooling systems.

The rapid expansion of IoT and 5G technologies is accelerating the transformation of smaller data center facilities into edge computing data centers to meet low-latency processing demands. These edge facilities are designed to bring computing power closer to data generation points, reducing transmission delays and improving real-time analytics capabilities.

US Data Center Renovation Market Analysis

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Based on product, the market is divided into cooling, power, IT racks & enclosures, networking equipment, LV/MV distribution & DCIM. The cooling segment dominated the US data center renovation industry, accounting for 39% in 2024 and is expected to grow at a CAGR of over 19% through 2034.

• The cooling segment was at the forefront of the US data center renovation market in 2024, with a value of USD 3.51 billion and is expected to reach USD 20.17 billion by 2034. Increased usage of electricity, energy efficiency regulations, and utilization of artificial intelligence loads are driving the growth of the cooling segment. In addition, the cooling segment is transitioning towards liquid cooling and hybrid cooling systems, as customers are balancing energy efficiency and water efficiency and overcoming various hurdles associated with cooling because of regulations and sustainability increases.
  
• Power infrastructure accounted for 26.7% share of the market in 2024, valued at USD 2.38 billion, and is estimated to reach USD 11.81 billion by 2034, growing at 18.1% CAGR between 2025 and 2034. The key drivers of growth are the increase in power loads generated by artificial intelligence workloads, grid capacity, and renewable energy generation. Power infrastructure improvements are related to upgraded distribution systems, backup power systems, and energy storage, especially with increased investment in the grid, on-site power generation, and energy storage to promote energy efficiency and resiliency.
  
• IT racks/enclosures segment held 10.4% share and market size of USD 932 million in 2024. The segment is anticipated to reach USD 3.46 billion by 2034, growing at a CAGR of 14.7% between 2025 and 2034. IT racks/enclosures as an upgrade for customers are prevalent as higher density rack mounts are required and the introduction of liquid cooling. Newer rack mounts are designed for load/unload at 20–40 kW, improve airflow management with new racks, provide advanced new cable systems, provide coolant distribution within racks and educational/education tools to manage the thermal load from artificial intelligence impacts and/or dense environment while improving the effective use of space.

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Based on data center, the US data center renovation market is segmented by hyperscale, colocation, enterprise and edge. Hyperscale segment dominated the market with 43% share in 2024, and the segment is expected to grow at a CAGR of 19.4% from 2025 to 2034.

• Hyperscale renovations led the market, and these renovations are focused mainly on optimization of power density, liquid cooling and high-speed networking, in support of AI workloads. Significant growth in capex and commitments to sustainability goals concerning renewable energy and carbon neutrality are further motivation for large-scale upgrades of infrastructures at hyperscale facilities.
  
• Growth in colocation is primarily driven by enterprise clients outsourcing their infrastructure management while requiring flexible, high-density, and modular environments. Renovations are focused on scalable power systems, mixed cooling solutions, granular metering, and cutting-edge DCIM platforms for customer visibility and operational efficiency.
  
• Enterprise data centers had a 13.9% market share in 2024 worth USD 1.24 billion, and it is projected to reach USD 5.18 billion by 2034 at a CAGR of 16.1%. Renovations are mainly driven by aging infrastructure, energy efficiency mandates, and federally supported optimization programs. Upgrades are being slower due to budget constraints and risks but increasing due to modular and fractional approaches and government initiatives such as the Better Buildings Challenge, which encourage modernization and sustainability enhancements.
  
• Renovation activities are directed towards low-latency applications that will be enhanced by the proliferation of 5G and IoT devices. The projects under consideration focus on small form factor energy-efficient systems, remote out-of-band management, and integration into telecom infrastructure; telecom and CDN providers are converting existing facilities into distributed edge sites.
  

Based on application, the US data center renovation market is segmented into BFSI, government, healthcare, IT & telecom, automotive, media & entertainment and others.

• The BFSI sector maintained a 32.6% share in 2024, amounting to USD 2.91 billion, and is expected to grow at 17.3% CAGR, reaching USD 13.46 billion in 2034. Renovations aim to ensure uptime, redundancy and compliance for mission-critical assets. The increase in AI usage for fraud detection, algorithmic trading and risk modeling is prompting upgrades to GPU-dense environments, DCIM, and monitoring systems. Growth is expected to remain strong due to regulatory caution as well as digital transformation requirements.
  
• The government facilities segment holds 17.3% share in 2024, equal to USD 1.54 billion and expected to reach USD 7.6 billion in 2034 growing at 18% CAGR. Renovation in this segment is driven by federal mandates and sustainability goals and will focus on energy efficiency, carbon removal, and modernization. Integrative efforts such as consolidating data centers, deploying renewable energy, and installing advanced cooling technology will increase these facilities' latest demand. Government Cyber Security initiatives and long-term investments in Digital Government projects will continue to support robust growth.
  
• The healthcare sector was responsible for a 16.4% share in 2024, with a market size of USD 1.46 billion, and is projected to reach USD 9.46 billion by 2034 with a CAGR of 21.2%. The continued uptick in the amount of data being collected attributable to FIHR (federal interagency health record), tele-health, and genomics demand further renovations. The acquisition of AI in clinical imaging and diagnostics continues to refocus renovations related to GPU and storage technologies to support increasingly data-heavy applications of the ongoing healthcare digital transformation. In this sector, projects are committed to HIPAA compliance, redundancy, and edge-computing tactics to support real-time care and the never-ending demand for digitizing health records to support continuity of care.

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The Northeast US data center renovation market held a market share of 20% and reached USD 1.77 billion in 2024, growing from USD 1.64 billion in 2023.

• This is regarded as a mature market with legacy infrastructure owned by data center operators and financial enterprise organizations. Renovations focus on energy efficiency, renewable energy integration, and aging facility modernization, driven by financial services demand, but also the modernization of aging critical facilities, due to financial services. Aggressive renewable mandates in New York and New Jersey, alongside climate-focused policies in Massachusetts, incentivize upgrades. Pennsylvania offers cost-effective growth opportunities.
  
• The region is also a resource for reasonably priced growth, especially in Pennsylvania. The geographic proximity allows for very firm limitations due to regulatory, higher real estate, and energy costs, as well as a limited supply of land. Despite these limitations, Northeast proximity to financial, enterprise, and media hubs keeps the market active for renovations in these mission-critical application.
  

Midwest US data center renovation market is anticipated to show lucrative growth over the forecast period. The Midwest region held 18.2% of the market in 2024 valued at USD 1.63 billion and is expected to reach USD 7.35 billion by 2034 at 17.0% CAGR.

• The Midwest region benefits from moderately priced energy, land availability, moderate climate, and being well geographically located. Renovation plans are not being driven mainly by the enterprise modernization but as well as the digitalization of manufacturing, logistics hubs, and automotive industries.
  
• Factors that are more relevant to the Midwest are fiber connectivity, strategic locations in for the site selection process, and access availability. In addition, the moderate climate allows for a high degree of cooling efficiency due to the operation of free-air economization. The region has been noted for its energy efficiency and moderate climate.
  

West US data center renovation market is anticipated to show lucrative growth over the forecast period. In 2024, the West region dominated the market with a 35.6% share and is expected to grow at 18.7% CAGR to reach USD 16.67 billion by 2034.

• The significant presence of major technology companies and cloud providers and the potential for renewable energy vary across the states in the region. Data center renovation is being driven by water shortages and stratified electricity costs leading to a positive transformation of cooling systems into air-cooled systems and dry coolers. Renewable solar, wind, and hydro sources, along with respective state renewable mandates, support energy-efficient refurbishment.
  
• Emerging markets such as Phoenix, Las Vegas, and Portland further add benefits with regards to operating costs and land availability. Growth in the segment has been fueled by rapid and healthy demand for cloud, artificial intelligence, and entertainment media segments, although elevated real estate prices and regulations have tended to constrain expansion in the region.
  

Southeast US data center renovation market is anticipated to show lucrative growth over the forecast period.

• In 2024, the Southeast region held a 26.3% market share valued at USD 2.35 billion and expected to grow at 19.9% CAGR to reach USD 13.60 billion by 2034. In fact, it represents the fastest growing US region. The region is comprised of Virginia, North Carolina, Georgia, Florida, and Texas with strong possibilities for hyperscale deployments due to electricity costs that are competitive with any region in the country, tax incentives, connectivity (fiber), and supportive regulations.
  
• Northern Virginia is known as the global hub of data centers as a strong concentration of the data centers that support the constituents serve clients in a competitive, reliable environment with a great economy of scale. Atlanta, Dallas, and Houston are quickly, as and example, becoming major hubs for growing regions.
  
• When data centers engage in renovation, the focus has been on scalable power infrastructure, modular designs, as well as connectivity enhancement and upgrades. Nicholas North Caroline is a prime example of a renovation market focused on power distribution design and upgrades.
  

US Data Center Renovation Market Share

• The top 7 companies in the US data center renovation industry are Equinix, Digital Realty Trust, Schneider Electric, CBRE Group, Vertiv Holdings, JLL (Jones Lang LaSalle) and Iron Mountain contributing 47% of the market in 2024.
  
• Equinix holds the top position in the market, with a market share of 9.4%. With the company being the largest colocation data center operator in the world and owning a significant number of facilities in the US. Renovation activity by Equinix encompasses renovations to existing facilities to support higher power densities, new cooling technology and renewable energy. Equinix's position as the market leader is attributed to its size advantage, technical expertise and customer relationships that generate opportunities to renovate facilities due to constantly changing customer needs.
  
• Digital Realty Trust, as a leading data center real estate investment trust, operates a significant number of facilities in the US. Digital Realty has renovation capability and focuses on converting legacy facilities to support needs of hyperscale and cloud service providers, as well as sustainable business operations that corporate customers are committing to adhere to for environmental reasons and operating with flexibility to meet customer needs. Digital Realty's balance sheet and their model of owning facilities long-term enables them to make capital investments that require capital commitment to renovation that smaller operators are unable to make.
  
• Schneider Electric is focused on power management and cooling solutions for data center environments. Renovation activities include electrical distribution, uninterruptible power supply (UPS) systems, cooling infrastructure, and data center infrastructure management (DCIM) software. The company has developed its EcoStruxure platform to connect the physical layer of infrastructure with digital monitoring and control layers, enabling holistic renovation programs.
  
• CBRE Group provide global commercial real estate and data center advisory services. Renovation activity focuses on project management, infrastructure optimization, facility management to locate opportunities for upgrades. CBRE group coordinates various complex renovation programs, ensuring project execution with operational continuity of business and integration of multiple different systems. The company's global reach and existing relationships with operators has access to renovation transactions across facility types and geographies. The company's expertise in managing contractors and vendors has positioned CBRE group to capture more renovation opportunities in the US market.
  
• Vertiv Holdings is providing solutions for power, cooling, monitoring and IT infrastructure. Renovation activities consist of upgrading power distribution systems, UPS systems, thermal management systems and monitoring software. The massive use of Liebert brand equipment is creating an opportunity for upgrades and/or modernization efforts, especially transitioning from air-cooled systems to liquid-cooled systems through direct final connections within to systems themselves and the envelope (the concrete and steel) of the data center itself.
  
• JLL is providing comprehensive services in global commercial real estate, data center advisory, and project management. Renovation work centers on modernizing portfolios, enhancing facilities, and continuous improvement via strategic advisory and management. JLL uses its market intelligence, technology and regulatory analysis to inform renovation investments. JLL’s advisory services engage clients in the design of renovation and modernization plans that support efficient and sustainable built environments.
  
• Iron Mountain specializes in colocation services and data management solutions. Renovation work centers on increased power densities for customers, increased connectivity, and energy efficiency based on evolving client needs. Iron Mountain leverages its heritage as a records management company to assist with the transition of clients from physical storage and processing to digital infrastructure. Renovation work effectively enhances modernization to ensure facilities provide reliability for increasingly complex workloads for clients. Iron Mountain also has a strong base of existing clientele that creates opportunities for incremental infrastructure upgrades within the data center footprint of properties across the US
  

US Data Center Renovation Market Companies

Major players operating in the US data center renovation industry are:

• American Tower
• CBRE
• Cushman & Wakefield
• Digital Realty Trust
• Eaton
• Equinix
• Iron Mountain
• JLL (Jones Lang LaSalle)
• Schneider Electric
• Vertiv
  
  
• Equinix and Digital Realty Trust are starting to modernize and renovate data centers in the US as major participants in the lucrative renovations market, benefiting from a vast operations scale and global footprint across different areas. Digital Realty prioritizes standards around infrastructure access and modernization across its environment by focusing on deployment around PlatformDIGITAL as well as sustainability investments around energy efficiency and upholding its operational standards of acquired investments alongside facility operational/programmatic bases.
  
• Across the United States, key providers of critical infrastructure solutions are Schneider Electric and Vertiv Holdings. Schneider Electric is a complete provider of power management and cooling solutions around existing infrastructure, including traditional and liquid cooling systems, uninterruptible power supply infrastructure, and EcoStruxure as management platforms in support of sustainability and energy efficiency metrics across its program. Vertiv Holdings focuses on power distribution, backup power systems, thermal management, and IT infrastructure, which is focused on liquid cooling technologies.
  
• CBRE Group and JLL offer critical services in support of data center renovation work in the US CBRE has developed real estate advisory, project management and facility management services that aid clients re-evaluate and improve their portfolios, coordinate contractors, enhance ongoing operations, and perform market research to inform renovation-level investments. JLL provides strategic advisory services to clients, project management for renovations and new construction, facility management, and consulting services that emphasize research and the ability to draw from expertise across sectors.
  
• Iron Mountain is centered on colocation and data management solutions, and renovation strategies are related to its focus on upgrading its facilities through renovations based upon evolving customer needs. In leveraging its customer-driven heritage in records management, Iron Mountain supports its customers’ digital transformation programs as data and workloads become digitized. Data transformation and migrants depend upon being secure, compliant, and less constrained by infrastructure, especially within regulated markets such as financial services, healthcare, and government.
  
• Cushman & Wakefield is a commercial real estate services company that provides advisory, project management and facility optimization services to data centers. Renovation assistance includes infrastructure audits, energy efficiency upgrades and portfolio strategy engagement so operators can modernize facilities, improve operational continuity, and adopt sustainable practices while maintaining consistency with the client's business needs and market needs. American Tower Corporation operates distributed infrastructure for wireless networks and edge data centers. Renovation efforts around fee presentations focus on power redundancy, cooling improvements, and new synergies with telecommunications infrastructure to meet increasing demands for data, the effectiveness of the 5G rollout, and low-latency applications while leveraging its nationwide tower and colocation base to enable expanded edge computing.
  

US Data Center Renovation Industry News

• In February 2025, Vertiv introduced its worldwide portfolio of Fluid Cooling Services for AI and high-density computing. Their new service includes integration, deploying, installing, and maintaining a liquid cooling system. The Fluid Cooling service also supports retrofitting existing facilities converting to AI workloads. Their service solution includes direct-to-chip, rear-door heat exchanger, and immersion cooling service solutions, each requiring specialized engineering, procurement, and installation skilled labor expertise above and beyond traditional air-cooled businesses.
  
• In Feb 2025, CBRE reported North American primary market vacancies are close to record lows (1.9%) with 6,350 MW tracked under construction. The leasing volume and increasing rates are impacting operators to renovate existing facilities in order to maximize capacity, now in primary wholesale markets, Hillsboro, Oregon for example, showed an extraordinarily high increase of 46% in 3-10 MW requirements including renovations year-over-year.
  
• In January 2025,American Electric Power announced a transmission expansion across the state of Ohio and several neighboring states totaling approximately $2.82 billion in order to accommodate data center growth. AEP stated that the project would address electrical grid constraints on existing renovations and new builds. AEP also plans to add up to 1 GW of Bloom Energy fuel cells and ancillary services in support of interim backup power to enable attractive capacity.
  
• In November 2025, Meta will invest over $1 billion to build a 700,000 sq. ft. AI-focused data center in Beaver Dam, Wisconsin, operational by 2027. Partnering with Alliant Energy, Meta will fund $200 million in energy infrastructure upgrades. The project reflects the trend toward secondary markets with available power and favorable regulatory environments.
  

The US data center renovation market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue ($ Mn/Bn) from 2021 to 2034, for the following segments:

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Market, By Product

• Cooling
• Power
• IT Racks & enclosures
• Networking equipment
• LV/MV distribution
• DCIM

Market, By Data Center

• Hyperscale
• Colocation
• Enterprise
• Edge

Market, By Application

• BFSI
• Government
• Healthcare
• IT & telecom
• Automotive
• Media & entertainment
• Others

The above information is provided for the following regions and countries:

• US
  • Northeast
    • Connecticut
    • Maine
    • Massachusetts
    • New Hampshire
    • Rhode Island
    • Vermont
    • New Jersey
    • New York
    • Pennsylvania
  • Southeast
    • Alabama
    • Arkansas
    • Delaware
    • Florida
    • Georgia
    • Kentucky
    • Louisiana
    • Maryland
    • Mississippi
    • North Carolina
    • Oklahoma
    • South Carolina
    • Tennessee
    • Texas
    • Virginia
    • West Virginia
  • Midwest
    • Illinois
    • Indiana
    • Iowa
    • Kansas
    • Michigan
    • Minnesota
    • Missouri
    • Nebraska
    • North Dakota
    • Ohio
    • South Dakota
    • Wisconsin
  • West
    • Alaska
    • Arizona
    • California
    • Colorado
    • Hawaii
    • Idaho
    • Montana
    • Nevada
    • New Mexico
    • Oregon
    • Utah
    • Washington
    • Wyoming