Beyond the Megawatts: How Data Centers Are Reshaping Industrial Markets
Artificial intelligence and cloud computing continue to drive demand for data centers. A new Cushman & Wakefield report said that those facilities offer more than support for cloud computing and artificial intelligence.
In From Megawatts to Multipliers: The Data Center Effect on Industrial Demand, Jobs and Local Revenue, the Cushman & Wakefield authors point out that such developments can spur employment growth, regional economic development and industrial real estate demand.
In other words, “the economic impacts of data center investment extend beyond the immediate construction and operations of these facilities,” the report said.
The authors analyzed Atlanta, Austin/San Antonio, Chicago, Dallas-Fort Worth, Phoenix and Virginia to learn the impact of data center construction on regional industrial leasing and economic activity. Together, these markets account for over 11 gigawatts of data center capacity currently under construction and more than 4.1 billion square feet of industrial product.
A Boost in Industrial Leasing
One report finding is that companies supporting data center development and operations have become a significant source of industrial leasing demand outside of hyperscale operators.
Between 2022 and 2025, these “support” businesses accounted for 10.4% of all new industrial leases, rising to a record 14.4% of leasing activity in 2025. Additionally, data center-related tenant leasing increased 44% year over year in 2025, outpacing the broader industrial market.
The report studied suppliers and vendors, including electrical contractors, HVAC manufacturers, fiber-optic suppliers, power equipment companies, engineering firms, telecom providers, wholesalers and construction-related businesses.
Regionally:
Data center-related companies in Virginia accounted for 13.4% of new industrial leasing between 2022 and 2025.
Dallas-Fort Worth, one of the fastest-growing markets, recorded the largest year-over-year increase in data center-related industrial leasing during 2025.
Phoenix reported one of the highest concentrations of industrial demand tied to data centers. relative to overall inventory.
Jobs and Economic Growth
Based on data center-driven industrial leasing, the Cushman & Wakefield authors estimated that between 33,000 and 50,000 initial jobs were generated across the six markets from 2022 through 2025.
The report went further, noting that every job created by data center-supported industries generated approximately 2.5 other area jobs due to consumer spending and supplier activity, totaling between 81,000 and 124,000 jobs.
The report quantified the economic impact, citing the following:
Between 2022 and 2025, cumulative gross output ranged between $31.1 billion and $46.4 billion across all six markets.
During the same period, $25.2 billion in gross regional product and more than $2 billion in fiscal benefits were generated.
Data center-associated industrial activity generated approximately $11.6 billion in gross output and $500 million in tax revenue annually.
More Than Energy-Intensive Facilities
The Cushman & Wakefield authors said that data centers are not just facilities that support cloud computing, artificial intelligence and online applications. They can also “stimulate downstream economic activity for attracting adjacent industrial uses and supporting supply chain activity in surrounding regions,” the authors said.
As such, data centers can serve as a driver of warehouse demand and long-term local and regional economic activity.
