Data Decoded: The Case for Data Centers
Today’s data-driven world has propelled the rapid rise in data creation and the need for data centers.
Digital Infrastructure’s Expansive Destiny
Infrastructure growth is inescapable amid outsized data center demand.
WHAT FUELS THE GROWTH OF DIGITAL DEMAND?
Emanating from every aspect of our increasingly digital lives, data can provide invaluable business insights on everything from customer behavior to process optimization. Still, existing infrastructure is not keeping up with the data being produced, meaning most data-derived opportunities remain untapped. Closing the gap between data generated and the ability to leverage it is a priority that promises to foster robust demand for digital infrastructure for years to come.
DATA CENTERS ARE KEY TO UNLOCKING GROWTH
As the world is becoming increasingly digital, data is being generated at an explosive pace and is forecast to increase four-fold from 2020 levels by 2025. The rapid growth is intensifying the demand for data centers, which are the physical backbone of the internet and ultimately facilitating our digital lives. They are large industrial buildings constructed to house racks of computer servers that store data and connect internet traffic.
Once seen as a niche segment within the real estate sector, data centers are evolving into a mainstream growth industry for the overall real estate industry as they sit at a critical intersection of real estate, infrastructure, and technological advancements like AI. This is driving strong growth in the space, with the global colocation data center market expected to grow at a compound annual growth rate of 11.3% through to 2026.
Data Center Growth Abound In The Digital Age
PGIM Real Estate explains how big catalysts, such as generative AI, are creating structural tailwinds for data center growth.
The Digital Value Chain
A massive infrastructure upgrade cycle is underway to support artificial intelligence (AI) growth.
Data Center Demand Growth: Driving Unprecedented Opportunities
PGIM Real Estate discusses how expanding demand and constrained supply create exciting opportunities for data center investments.
* 1 zettabyte = 1 trillion gigabytes, which is equivalent to 250 billion DVDs
1 Source: Statista, as of November 16, 2023.
2 Source: 5 Interesting Facts about Data Analytics, BLUE OCEAN LAB as of February 20, 2023.
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