Data Center Surge Drives All US Nonresidential Spending Growth in July

Industry Pulse News Desk · 2026-09-02

Data center construction offset broader contractions as nonresidential spending excluding the sector fell to its lowest point since September 2023.

Data center construction single-handedly propelled total U.S. nonresidential spending growth in July, preventing an overall contraction across the broader commercial building sector, according to an analysis of industry data released this week.

Excluding data center developments, nonresidential construction expenditures dropped to their lowest monthly level since September 2023. The figures highlight a widening divide between technology-driven infrastructure investment and traditional real estate sectors.

High interest rates, elevated material costs, and restrictive commercial bank lending standards have continued to weigh heavily on private-sector projects. Developers across office, retail, and commercial categories have increasingly delayed groundbreakings or scaled back planned expansions.

In contrast, persistent demand for artificial intelligence applications and expanding cloud computing capacity has sustained record capital allocation toward data center projects nationwide. Massive investments from major technology corporations and institutional funds have insulated the overall sector figures from broader declines.

Trade group economists emphasized that while data center expansions remain a vital buffer for construction volume, the contraction across nonresidential categories excluding data centers signals ongoing vulnerability for commercial contractors entering the fourth quarter.

Future growth in nonresidential spending is expected to remain heavily tied to utility grid interconnections and power availability, which present key operational hurdles for upcoming data center developments.