PRESS RELEASE

• Data Centre Construction Cost Index (DCCCI) reveals how AI is driving unprecedented large-scale projects and pushing up the cost of materials and labour
• Tokyo, Osaka, Zurich, Singapore and Silicon Valley are the highest cost locations, while Shanghai and Mumbai are the lowest 
• 81% of over 400 experts report skilled labour shortages, with contractor capacity lowest in Europe and North America  

Global data centre construction shifted towards large-scale projects in 2026, as surging demand for AI computing power outpaced the supply of powered land and skilled labour to deliver them, according to the latest research from Turner & Townsend, the global programme management company.   

Turner & Townsend’s Data Centre Construction Index (DCCCI) report, now in its 10th edition, is the leading global benchmark for data centre construction costs, drawing on over 500 live or recently completed projects in 62 markets and supplemented by a survey of over 400 experts working across the global data centre industry.  

The research shows that despite some stabilisation in cost inflation in 2026, structurally higher construction costs and risk are increasingly priced into contracting, while a deepening skills shortage is putting pressure on labour costs.  

Data centre construction costs are increasingly driven by the growing scale of the builds, particularly for AI facilities, which require alternative delivery approaches, technical specialists and new risk-balanced models to overcome strained capacity and accelerate schedules. 52% of respondents anticipate a majority (>50%) of their 2027 projects will be data centres to support AI workloads.  

52% of survey respondents experienced cost increases in 2026 above 6%, with approximately 20% reporting inflation above 15%. In 2027, 28% of respondents expect inflation to be between 1-5%, indicating a continued softening of cost pressure. 57% of respondents expect inflation to be below 15%. 

81% of survey respondents report that skilled labour in their region is either moderately or highly constrained, and just 52% believe contractor capacity is manageable for now. However, in North America only 26% believe regional capacity is sufficient and in the UK and Europe this falls to just 19%. 

56% of survey respondents identified power as a major obstacle to successful delivery, with over half (52%) reporting that utility connections typically take between one and two years, and almost a third (32%) reporting timeframes over two years.  

Japan is the world’s most expensive location to build new data centres  

The highest cost locations ($/W) in the index were Tokyo ($18.28), Osaka ($17.15), Zurich ($15.93), Singapore ($15.39) and Silicon Valley ($15.01). While Japan holds the top spot in the index, the fact that 17 European and 13 North American markets make up almost half of the top table reflects these regions’ continued dominance of the industry. Around half of all global data centres are in North America, and a quarter are in Europe.  

By contrast the lowest cost locations ($/W) in the index were Shanghai ($5.79), Mumbai ($6.83), Ho Chi Minh City ($8.32), Bogota ($9.13) and the UAE ($9.20), where  lower labour costs reduce the overall construction cost in these emerging data centre markets.  

“Over the decade since we first published our construction cost index we have seen the data centre industry transform, with capital expenditure on data centres now US$800 billion per year, and expected to reach US$1.8 trillion by 20501*. AI’s exponential demand for computing power, combined with cloud adoption and the growing importance of data and sovereign capacity, is driving data centre investment and development at unprecedented scale, reshaping the construction landscape. 

“However, rising material and labour costs continue to create challenges globally, while access to power, specialist equipment and skills continue to create bottlenecks. Data centres are also subject to increasing scrutiny, with political and community consent essential to delivery. AI-driven demand for gigawatt-level power and liquid cooling for increased rack densities is driving the growth of larger-scale data centres, but the shortage of skilled labour and the greater risks involved in the delivery of larger more complex projects is driving a cost premium.” 

Paul Barry

Data Centre Lead, North America

Turner & Townsend

*Source: PwC’s global AI infrastructure report   

Global Data Centre Construction Cost Index  

62 markets feature in this year’s index, providing an indicative cost per watt and index score, based on a typical 60 MW design.