Key Takeaways from JLL’s 2025 Global Data Center Outlook

We’ve read JLL’s 2025 Global Data Center Outlook and have picked out the key takeaways from the report. Overall, the data center market is likely to expand at 15% CAGR through 2027. The upside potential: 20% CAGR through 2027.

Read the full report here

Contents

• Artificial Intelligence (AI)
• Power grids
• Liquid cooling
• Capital markets

Artificial Intelligence (AI) 

“The data center industry stands at the dawn of a transformative era, driven by the relentless advancement of artificial intelligence. This technological revolution is not merely evolving the digital infrastructure landscape, it is fundamentally redefining it.”

According to the report:

• AI demand will continue to build momentum in 2025. 
• Rack density has surged – GPUs are transitioning from 7 nm to 5 nm, and soon to 2 nm technology, enabling unprecedented power levels.
• Advancement of GPU technology means faster training of large language models, and in the next couple of years technology companies will run out of high-quality data for training them. 
• A new AI training facility requests 1GW of power or more, consuming the same power as 800,000 US homes in one year. 
• The need for power has led to decoupling of AI training and inference facilities: 
  • Training facilities are built near power sources 
  • Inference facilities are built near population centers for end user access and lower latency

Power grids 

Power availability 

• Data centers currently account for 2% of global electricity consumption.
• They will represent a relatively small component of global electricity demand growth in 2025 – less than a third of the increase for electric vehicles and air conditioning. 
• Forecasts estimate that global data center energy demand will double in the next five years to 100 GW. 

Clustering 

• Clustering of data centers leads to bottlenecks of power delivery – Tokyo, Virginia and London are examples of this.
• Power delays don’t only come from power scarcity, but also the need to build high-capacity power lines and have smooth supply chains for transformers and switch gear.  

Nuclear 

• Nuclear energy is emerging as the preferred solution – SMR agreements will likely double in 2025.
• More than 100 sites are being evaluated for SMR installations. The downsides: 
  • Regulatory hurdles 
  • High initial costs 
  • Public perception issues 

Read more: Can Nuclear Energy Solve the Data Centre Power Challenge?

Liquid cooling 

“The AI revolution is undoubtedly changing the world, but AI’s energy footprint may be its most profound and lasting impact. New PUE (power usage effectiveness) regulations and greater rack densities will drive the industry towards liquid cooling, as it is nearly impossible to achieve low PUE values with traditional air cooling alone.” 

• NVIDIA’s latest AI chips consume up to 300% more power than their predecessors.
• A hybrid approach to cooling is typically used at the moment, but liquid cooling is becoming essential.
• Immersion cooling will become more common, but broad implementation is still a few years away because of the challenges in structural design due to weight. 

Capital markets 

• Across the hyperscale and colocation segments, an estimated 10 GW is projected to break ground globally in 2025 and 7 GW will likely reach completion. 
• Private equity will play a significant role in development financing in 2025.
• Asset trades likely to increase only moderately in 2025.
• Older data centers are not in danger of becoming obsolete because only a portion of data centers will be dedicated solely to AI applications. The majority of data centers will run a combination of traditional workloads and AI applications. 
• Roughly $170 bn in data center asset value will need to secure construction lending or permanent financing in 2025.

Read the full report here