At a glance
- The premium widens to 9.8% near areas with 21 or more data centers.
- Tech tenants sign nearly twice as many leases in those areas as elsewhere—13.9% versus 7.1%, the report says.
- Allocators mapping industrial exposure need to know whether a site sits inside an area with 11 or more data centers within about two miles.
Industrial space near areas with 11 or more data centers rents about 6.8% more than comparable space elsewhere, according to CBRE Research. The premium widens to 9.8% near areas with 21 or more data centers.
Tech tenants sign nearly twice as many leases in those areas as elsewhere—13.9% versus 7.1%, the report says. Specialized R&D tenants nearly double their contribution, 35.0% versus 19.0%. CBRE defines such an area as 11 or more data centers within about two miles. Connect CRE reported on the Nov. 11 release of the third of four reports on AI and commercial real estate.
Allocators mapping industrial exposure need to know whether a site sits inside an area with 11 or more data centers within about two miles. A single new data center can move the line and add the 6.8% premium. An industrial basis that looks cheap against a submarket average may be pricing a site outside that area.
CBRE says ceiling heights of 40 feet or more are essential for automation, robotics and AI-guided operations, along with strong electrical capacity and layouts built for machines rather than people. The power requirement puts industrial landlords in the same queue as data center developers for utility service.
CBRE attributes the premium's durability to supply: "Almost no new supply is being built inside these areas, so this rent premium is durable."
Reported by the Sectors desk from Connect CRE. Published . Corrections