Atlanta Surpasses Northern Virginia As Top Market For Data Center Demand
Atlanta overtook Northern Virginia as the No. 1 market for data center absorption in 2024, marking the first time that Northern Virginia has lost its top position, according to CBRE.
Atlanta emerged as the national leader in data center demand in 2024 with net absorption reaching 705.8 megawatts — a figure that represents an almost 39-fold increase from the previous year, according to a CBRE report published this week.
In the span of just six months, Atlanta jumped from the seventh-ranked U.S. data center market to the second-largest, boosted by a 222% increase in total inventory throughout 2024. Now only Northern Virginia has more total data center capacity than the Atlanta market.
The data suggests that Atlanta’s growth isn’t slowing down in the immediate future. The market has 2,159.3 megawatts under construction, a pipeline that trails only Northern Virginia, and proposals for at least six large-scale campuses have been filed since the start of 2025.
CBRE Global Head of Data Center Solutions Pat Lynch said he’s reminded of a broker who years ago would refer to the then upstart Atlanta market as “Southern Ashburn,” a tongue-in-cheek reference to the Loudoun County home of Data Center Alley. Now the moniker seems more like a premonition than a joke.
“In some ways that’s come true, given the growth there,” Lynch said. “It’s a reasonable alternative to Loudoun County, where we’ve got some challenges with power.”
Indeed, while a number of factors have driven the influx of data centers into Atlanta, the power constraints troubling other markets, particularly Virginia, have been a major catalyst for the development surge the city is experiencing. Significant power delays first emerged in Loudoun County in 2022. With speed-to-market a priority to meet record demand, digital infrastructure providers began to descend on Atlanta due to its cheap, available power.
In addition to its grid capacity and low electricity prices, data center developers like the Atlanta market for its availability of nuclear power, said CBRE Director of Americas Data Center Research Gordon Dolven.
Developers have also been drawn by the proactive approach that utility Georgia Power and the state public utility regulator have taken when it comes to facilitating fast grid connections for large-scale data center projects.
“That’s sort of the perfect storm in terms of why it’s taken off,” Dolven said.
But it may not be long until Atlanta’s growth trajectory runs headlong into the power constraints that are already slowing development in most major data center markets.
Developable sites with immediate access to the massive amount of power data centers needed have become increasingly rare near Atlanta in recent months, and last spring the major regional utility announced delays of up to three years on substation buildouts needed for new grid connections.
Georgia Power parent Southern Co. revealed last week that it is delaying the retirement of multiple coal plants to meet increasing energy demands from data centers. The decision follows Georgia Power’s prediction that data centers will cause demand to triple within the next decade.
This week, Georgia’s Public Service Commission passed a rule that will allow Georgia Power to create targeted rates for data center projects meant to protect consumers from rate hikes as the utility scrambles to build out billions of dollars of new grid infrastructure to accommodate data center growth. Similar power pricing structures have been enacted in other markets where data centers have strained grid capacity.
Still, these power concerns don't seem to have slowed the parade of data center projects being proposed in Atlanta and throughout the Peach State.
Business Insider reported this week this week that Elon Musk’s xAI has been quietly building a $700M data center in Fulton County. Meanwhile, upstart Atlas Development has filed plans for three different Georgia data center campuses since the start of the year, the largest of them an 800-acre project with development costs as high as $17B. In January, real estate investment firm TPA Group and data center firm Serverfarm each announced separate large-scale campuses in Newton County, while Amazon pledged to invest $11B in Georgia to expand its AI infrastructure.
While the data released by CBRE this week highlighted Atlanta’s data center construction boom, it also provided a revealing snapshot of the unprecedented growth of the data center industry more broadly.
The North American data center sector doubled the amount of new supply under construction in 2024 from the previous year, and last year represented a 12-fold increase from 2020. Demand has followed suit, with primary market net absorption jumping from 329.6 megawatts in 2020 to 1,809.5 megawatts in 2024 — a 450% increase in just four years.
