Global Data Center Mechanical Construction Market Growth, Share, Size, Trends and Forecast (2025 - 2031)

• In May 2023, Data4 Group, a prominent player in data center operations and investments across Europe, unveiled plans to construct a new data center campus on the former Nokia site in Nosée, Essonne, France. This ambitious project, with an anticipated investment of approximately EUR 1 billion by 2030, aims to rejuvenate 22 hectares of industrial and office space while reinforcing the Group's presence in the Paris region.

• In April 2023, Microsoft announced the inauguration of its latest trusted cloud center in Poland, marking a significant milestone as the first of its kind in Central and Eastern Europe. The Microsoft Poland cloud region encompasses three physical locations in the vicinity of Warsaw, each housing one or multiple data centers. This initiative ensures data storage within the country, adhering to the highest standards of security, privacy, and regulatory compliance.

• In January 2023, TSL secured an order as part of a $2 billion investment by US real estate investor Vantage for constructing data centers across Europe. The project involves establishing a data center in Offenbach, with an initial construction phase targeting a capacity of 16 MW for the Vantage Data Centre. The broader campus plan encompasses three multistory data centers, with a combined maximum IT capacity of 55 MW rated power, spanning an overall area of 60,000 m2.

The Global Data Center Mechanical Construction Market is segmented based on several key factors, including infrastructure, tier type, size of data center, and end-user. By infrastructure, the market is categorized into electrical infrastructure, mechanical infrastructure, and other types of infrastructure. Electrical infrastructure encompasses critical systems such as UPS (Uninterruptible Power Supply) Systems and other electrical components, which ensure reliable power supply and prevent downtime. Mechanical infrastructure, including cooling systems, racks, server rail kits, and other elements, plays a pivotal role in maintaining optimal operational conditions within the data center. As demand for energy-efficient and sustainable data centers grows, innovations in cooling systems and energy management solutions are driving the mechanical construction market.

The market is also segmented by Tier Type, which includes Tier-I & Tier-II, Tier-III, and Tier-IV data centers. Tier-I and Tier-II data centers are typically designed for smaller-scale applications with fewer redundancy features, while Tier-III and Tier-IV facilities are more advanced, offering higher levels of reliability, redundancy, and security. As businesses and service providers increasingly require higher uptime and fault tolerance, the demand for Tier-III and Tier-IV data centers is rising. These facilities often involve more complex and resilient mechanical construction systems, requiring specialized cooling solutions, backup power infrastructure, and highly efficient management systems.

In terms of data center size, the market is split between small & medium-scale data centers and large-scale data centers. Small & medium-scale facilities cater to localized or less complex needs, requiring efficient, cost-effective mechanical systems. In contrast, large-scale data centers serve major enterprises and cloud service providers, necessitating complex mechanical systems for managing high server densities, power loads, and cooling needs. These large facilities are also where significant innovations in energy efficiency, sustainability, and cooling technologies are most evident. End-users of data center mechanical construction services span multiple industries, including banking, financial services & insurance (BFSI), IT & telecommunications, government & defense, healthcare, and others. As these sectors continue to adopt data-driven operations, the need for secure, reliable, and energy-efficient data center infrastructure will continue to grow, driving demand for advanced mechanical construction solutions.

Global Data Center Mechanical Construction Segment Analysis

In this report, the Global Data Center Mechanical Construction Market has been segmented by Infrastructure, Tier Type, Size of Data Center, End-User and Geography.

Global Data Center Mechanical Construction Market, By Infrastructure

The Global Data Center Mechanical Construction Market has been segmented by Infrastructure into Electrical Infrastructure (UPS Systems, and Other Electrical Infrastructure), Mechanical Infrastructure (Cooling Systems, Racks, Server rail kit and Other Mechanical Infrastructure), and Other Infrastructure.

Electrical Infrastructure includes components essential for the distribution, regulation, and management of electrical power within data centers. Key elements typically encompass Uninterruptible Power Supply (UPS) systems, which provide backup power during outages or fluctuations in the main power supply, ensuring continuous operation of critical equipment. Other electrical infrastructure components such as transformers, switchgear, distribution panels, and power distribution units (PDUs) fall under this category. These components collectively ensure reliable and efficient electrical power delivery to support the functioning of data center equipment and systems.

Mechanical Infrastructure encompasses various systems and equipment designed to regulate environmental conditions within data centers, primarily focusing on temperature and humidity control. Cooling systems are a vital component of the mechanical infrastructure, including air conditioning units, chillers, precision air conditioning (PAC) units, and computer room air handlers (CRAHs). These systems are crucial for dissipating heat generated by servers and other IT equipment, maintaining optimal operating temperatures, and preventing overheating. Mechanical infrastructure may also include racks, server rail kits, raised flooring, and cable management systems, which are essential for organizing and optimizing the physical layout of data center equipment.

Other Infrastructure encompasses various auxiliary infrastructure components and systems that support the overall functionality and operations of data centers but do not fall specifically under electrical or mechanical infrastructure. Examples of other infrastructure elements may include fire suppression systems, security systems (such as access control and surveillance systems), environmental monitoring systems, backup generators, and facility management systems (FMS). These components play critical roles in ensuring the safety, security, and operational efficiency of data center facilities.

Global Data Center Mechanical Construction Market, By Tier Type

The Global Data Center Mechanical Construction Market has been segmented by Tier Type into Tier-I & Tier-II, Tier-III, and Tier-IV.

The tier 3 segment has emerged as the dominant force in the data center construction market, capturing the largest revenue share. This dominance is primarily driven by increased redundancy measures implemented across data centers, ensuring high reliability and availability of services. The growing demand for high-performance computing and expanded storage capacity has fueled the prominence of tier 3 facilities.

Tier 3 standards are particularly favored by media providers like Netflix and Facebook, as well as by players in the financial and service industries. These standards offer robust power backup systems and enhanced cooling efficiency, achieved through optimized airflow architectures. Furthermore, tier 3 designs facilitate the equitable distribution of workloads across servers by continuously monitoring and balancing high-intensity tasks. These advantages have incentivized investment in tier 3 facilities by colocation service providers, telecommunications companies, social media giants, and e-commerce enterprises, all seeking to optimize their data infrastructure and enhance service reliability.

Global Data Center Mechanical Construction Market, By Size of Data Center

The Global Data Center Mechanical Construction Market has been segmented by Size of Data Center into Small & Medium-scale Data Center, and Large-scale Data Center.

The Global Data Center Mechanical Construction Market is segmented by the size of data center, with two primary categories: Small & Medium-scale Data Centers and Large-scale Data Centers. Small & Medium-scale Data Centers typically cater to businesses with specific, localized data needs, offering a more cost-effective solution compared to larger, more complex facilities. These data centers often require more efficient, scalable mechanical systems, including compact cooling solutions, power management systems, and energy-efficient designs. As smaller businesses or enterprises increasingly rely on data-driven operations, the demand for these types of facilities has been growing, driven by the need for localized processing and storage capacities.

In contrast, Large-scale Data Centers are built to support high-capacity operations, often serving hyperscalers, cloud service providers, or large enterprises. These facilities require robust mechanical infrastructure, including advanced cooling systems, power backup solutions, and sophisticated environmental controls to manage the massive amounts of data processing and storage needs. Large-scale data centers also face the challenge of managing high-density server loads, which drives demand for more energy-efficient systems, innovative cooling techniques, and high-performance power management solutions. As large-scale data centers expand globally, their mechanical construction needs become increasingly complex, pushing the market toward more specialized solutions that prioritize both operational efficiency and sustainability.

The segmentation by size reflects the differing requirements and priorities in mechanical construction for each data center type. Small & medium-scale data centers focus on cost efficiency, scalability, and simplicity in their mechanical designs, while large-scale data centers require intricate planning, advanced technologies, and high levels of redundancy to ensure uninterrupted service. As businesses of all sizes continue to embrace digital transformation and data-driven strategies, the demand for both small and medium-scale as well as large-scale data centers is expected to increase, with mechanical construction companies needing to adapt to the unique needs of each segment. This shift is fueling innovation in cooling technologies, power management, and overall design to ensure that these data centers remain efficient, reliable, and scalable.

Global Data Center Mechanical Construction Market, By End-User

The Global Data Center Mechanical Construction Market has been segmented by End-User into Banking, Financial Services & Insurance, IT & Telecommunications, Government & Defense, Healthcare, and Other End Users.

The IT and telecom segment emerged as the market leader in data center construction, commanding the largest share due to the widespread adoption of smartphones and increasing global internet users. The expansion of 5G networks further bolstered this dominance, with expectations for this trend to persist in the foreseeable future. The segment's growth is fueled by the ongoing adoption of network function virtualization (NFV) and software-defined networks (SDN), particularly in supporting Over-The-Top (OTT) platforms, machine-to-machine (M2M) communication, and online gaming. This momentum is anticipated to drive continued investments in this sector.

Across various industries and verticals, there's a noticeable uptake in cloud computing, Internet of Things (IoT), artificial intelligence (AI), and intelligent computing. Developing nations are actively investing in data center infrastructure as part of their digital transformation initiatives. These facilities find extensive deployment in sectors such as banking, financial services, and insurance (BFSI), manufacturing, healthcare, and energy, among others. Huawei Technologies Co., Ltd. has introduced an SDN-based data center adopted by The Industrial and Commercial Bank of China. This solution enables the consolidation of multiple services onto a single network hardware, optimizing resource utilization and expediting service launches.

Global Data Center Mechanical Construction Market, By Geography

In this report, the Global Data Center Mechanical Construction Market has been segmented by Geography into five regions; North America, Europe, Asia Pacific, Middle East and Africa and Latin America.

Global Data Center Mechanical Construction Market Share (%), by Geographical Region, 2024

North America emerged as the leader in data center construction, commanding the largest revenue share, followed closely by Asia Pacific. North America's dominance is fueled by robust investments in hyperscale projects, particularly in the United States, which boasts a developed economy and a well-established network infrastructure. Major cloud service providers like Amazon.com, Inc., Google, and Facebook are driving significant investments in mega facilities to expand processing capabilities and data storage, presenting new avenues for market growth.

The U.S. market is primarily driven by the robust demand for cloud services, digital transformation initiatives, and the expansion of hyperscale data centers. Key trends include the rise of green data centers, the growth of edge computing, and the integration of artificial intelligence to enhance operational efficiency. Major players like Amazon Web Services, Microsoft, and Google are leading the market by consistently investing in new facilities and expanding existing ones to meet the growing demand. Regulatory factors, focusing on data privacy and sustainability, are also shaping market trends and dynamics.

Germany's data center construction market is expanding due to strong industrial demand, stringent data privacy regulations, and the country’s central role as a hub in Europe. Prominent trends in the market include the adoption of sustainable energy solutions, the rise of modular data centers, and the implementation of advanced cooling technologies to boost operational efficiency. Leading companies such as Interxion, NTT Global Data Centers, and Equinix are investing heavily in both new and expanded facilities to support increasing demand. The regulatory landscape in Germany is particularly strict, with a focus on ensuring data security, privacy, and sustainability.

China’s data center construction market is growing rapidly, driven by the country’s booming tech industry, rising cloud adoption, and government-backed initiatives to promote digital infrastructure. Key trends include the development of hyperscale data centers, the incorporation of AI and 5G technologies, and a focus on energy efficiency. Major players like Alibaba Cloud, Tencent Cloud, and China Telecom are dominating the market with significant investments in new data center developments across the country. The regulatory environment is heavily influenced by government policies related to data localization, security, and privacy, which are shaping the market's future direction.

This report provides an in depth analysis of various factors that impact the dynamics of Global Data Center Mechanical Construction Market. These factors include; Market Drivers, Restraints and Opportunities Analysis.

Drivers, Restraints and Opportunity Analysis

Drivers

• Government Digital Initiatives
• Rise of Adoption of Hyperscale Datacenters
• Growing Demand for SMAC Applications

• Edge Computing Reshaping Data Centers - Edge computing is a significant driver reshaping the Global Data Center Mechanical Construction Market, as it leads to the demand for more distributed, localized infrastructure. Edge computing involves processing data closer to the source of data generation, such as IoT devices, sensors, and local servers, rather than relying solely on centralized cloud data centers. This shift is prompting the construction of smaller, decentralized data centers at the edge of networks, which require specialized mechanical systems tailored to specific environmental conditions and energy demands. As a result, mechanical construction requirements for these edge data centers differ from traditional large-scale facilities, driving new opportunities in the market for constructing compact, energy-efficient, and high-performance mechanical systems.

  Edge computing is also pushing the demand for high-density cooling solutions and advanced power management systems. As edge data centers are typically located in remote or non-traditional settings, they often need bespoke cooling systems to ensure optimal performance in variable climates and environments. Unlike traditional data centers, which rely on centralized cooling solutions, edge data centers require distributed and sometimes more complex cooling technologies like liquid cooling or immersion cooling to handle the high heat density of localized data processing. This trend increases the need for specialized mechanical construction services to design and implement these systems, thereby fueling growth in the data center mechanical construction market. Additionally, energy efficiency becomes even more critical in edge computing due to the need to minimize operational costs and environmental impact, driving demand for sustainable and efficient mechanical solutions.

  The rise of edge computing is also influencing the design and layout of data centers to accommodate various factors like physical space, power supply, and security. Edge data centers often need to be more modular and scalable, with designs that allow for quick expansions as the demand for data processing grows. Mechanical construction in these centers must be adaptable to various configurations, ensuring that cooling, power, and networking systems can be integrated seamlessly as the infrastructure evolves. This requires innovative approaches to mechanical system design and construction, including the use of pre-fabricated components and highly modular infrastructure that can be easily replicated across multiple edge locations. As edge computing continues to grow, it significantly reshapes the global data center mechanical construction landscape by emphasizing the need for smaller, more flexible, and highly efficient data centers, ultimately driving demand for new mechanical construction solutions.

Restraints

• Space constraints in urban areas
• Environmental & Workforce-related Challenges

• Limited availability of skilled labor - The limited availability of skilled labor is a significant restraint in the Global Data Center Mechanical Construction Market, as the demand for data centers continues to grow across various industries. Building and maintaining data centers require specialized expertise in areas such as mechanical engineering, electrical systems, HVAC (heating, ventilation, and air conditioning), cooling systems, and energy management. The complexity of these projects, coupled with the rapid advancements in technology, means that there is an increasing demand for highly skilled workers who can ensure the design, installation, and maintenance of state-of-the-art mechanical systems. Unfortunately, the pool of such skilled professionals is limited, which can lead to delays in construction timelines, increased labor costs, and challenges in meeting project deadlines.

  The shortage of skilled labor in the data center mechanical construction sector can also lead to a rise in project costs, as companies are forced to offer higher wages and benefits to attract qualified workers. This can increase the overall expenditure for data center construction projects, particularly for large-scale facilities that require highly complex systems. Moreover, as the demand for data centers continues to increase globally, the competition for skilled labor intensifies, making it harder for companies to hire the talent they need. This shortage of skilled labor can lead to reliance on less experienced workers or subcontractors, which may impact the quality and efficiency of the mechanical systems being installed, further compounding the challenges faced by the industry.

  Additionally, the rapid pace of technological innovation in the data center sector requires continuous skill upgrades and training for workers in mechanical construction. As new technologies like liquid cooling, advanced energy efficiency systems, and sustainable construction practices become more prominent, the skill set required to design and implement these systems becomes increasingly complex. The limited availability of professionals with the right expertise to handle these advancements creates a barrier to adopting cutting-edge solutions that could improve the efficiency, sustainability, and overall performance of data centers. To overcome this challenge, companies in the data center mechanical construction market need to invest in training programs, attract talent through competitive compensation packages, and explore automation or advanced technologies to reduce dependency on skilled labor.

Opportunities

• Hyperscale growth
• Renewable energy adoption

• Growing demand for cloud computing and edge computing - Cloud computing, with its flexibility, scalability, and cost-effectiveness, continues to gain traction across various industries worldwide. Edge computing, which enables data processing closer to the source, is increasingly adopted to support emerging technologies like IoT, autonomous vehicles, and advanced robotics. This surge in demand necessitates the development and expansion of data center infrastructure, creating significant opportunities for mechanical construction providers to cater to the evolving needs of the market.
  
  With the proliferation of disruptive technologies such as IoT and AI, there is a growing need for robust and efficient data center infrastructure to support the processing and storage requirements of these technologies. This increased demand is driving investments in data center construction projects, leading to opportunities for mechanical construction companies to provide essential infrastructure solutions, including cooling systems, racks, and other mechanical components, to support the growing data center ecosystem.As businesses increasingly rely on cloud-based services and edge computing capabilities to support their operations, there is a growing need for robust and efficient data center infrastructure. The emergence of hyperscale data centers and the increasing focus on sustainability are driving innovation in mechanical construction practices, further shaping the growth trajectory of the market.

Key players in Global Data Center Mechanical Construction Market include;

• IBM Corporation
• SAS Institute Inc.
• DPR Construction Inc.
• Fortis Construction Inc.
• Turner Construction Co.
• Data4 Group
• Microsoft
• TSL
• Vantage Data Centers
• K2

In this report, the profile of each market player provides following information:

• Company Overview and Product Portfolio
• Key Developments
• Financial Overview
• Strategies
• Company SWOT Analysis