Data Center Construction Starts Fall to $9.4B in September as Costs Climb 31%

U.S. data center construction starts totaled $9.4 billion across 18 projects in September 2026, less than half of August's revised record of $25.8 billion, according to ConstructConnect's November Data Center Report published October 30. At the same time, the median cost to build a data center rose to $540.96 per square foot, 31% higher than a year earlier (ConstructConnect).

Even with the September pullback, data centers account for a large share of nonresidential building activity this year. Through September, data center starts reached $135.8 billion across 178 projects, or 27% of the $500.2 billion in U.S. nonresidential building starts so far in 2026 (ConstructConnect).

What Happened

The September figure pulled the 12-month moving average down to $14.9 billion. The two largest projects to break ground during the month were $2 billion data centers in Pennsylvania and West Virginia; ConstructConnect did not name them (ConstructConnect).

The bigger change in this report is the revision to August. In its October report, ConstructConnect had counted $14.4 billion in August starts across 17 projects and $98.5 billion year to date through August across 153 projects (ConstructConnect, October report). The November report now puts August at a record $25.8 billion (ConstructConnect). Taken with September's $9.4 billion, the new $135.8 billion year-to-date total implies a figure through August of roughly $126 billion, far above the $98.5 billion reported a month earlier. ConstructConnect did not explain the size of the revision in the report (ConstructConnect).

ConstructConnect said total 2026 data center starts are on pace to exceed $180 billion, about $20 billion above its latest full-year forecast (ConstructConnect).

Data Center Construction Cost Per Square Foot

Costs continue to rise faster than project size. The median cost per square foot for January through September was $540.96, up 31% from a year earlier, and the five-year compound annual growth rate in cost per square foot is 16.2% (ConstructConnect). In the year-to-date sample with known prices and square footage, the average project cost $1.3 billion and covered 1.1 million square feet (ConstructConnect).

The October report had put the trimmed median at $541 per square foot after removing the top and bottom 10% of projects, with an average of $867 per square foot, showing how a handful of very expensive projects pull the mean well above the median (ConstructConnect, October report). The report does not break out what is driving the increase, but it does track power infrastructure separately.

Where the Work Is

By region, the corridor from Wisconsin through Ohio holds the largest concentration of year-to-date data center starts at more than $40 billion. The South Atlantic states from Maryland to Florida follow at $36.2 billion, and the West South Central states, including Texas and Arkansas, total $33.6 billion (ConstructConnect). A month earlier, ConstructConnect reported that Texas alone had more than $22 billion in starts and that four states in the Wisconsin-to-Ohio group had $10 billion or more each (ConstructConnect, October report).

Looking ahead, ConstructConnect is tracking $74.8 billion in planned data center starts across 115 projects over the next six months. The South holds nearly 80% of that pipeline, the Midwest 11.9% and the Northeast 7.2% (ConstructConnect). Closer to home, WCG has followed proposals in Western New York's data center and power buildout and in Florida, where Palm Beach County staff approved nearly 700,000 square feet for Project Tango.

Power Infrastructure

Power infrastructure starts, which ConstructConnect tracks alongside data centers, grew at an average annual rate of 52.2% from 2021 to 2025. Year-to-date 2026 power infrastructure starts are up 167.4% from the same period in 2025, although ConstructConnect expects that growth rate to slow because the comparison now includes strong months from late 2025 (ConstructConnect).

Implications for Owners, Developers, Contractors and Subs

For contractors and subcontractors, the month-to-month swings in this data are large: August went from $14.4 billion to $25.8 billion on revision, and September came in at $9.4 billion (ConstructConnect, October report; ConstructConnect). Single months are a weak guide. The more useful signals are the year-to-date total, the six-month planned pipeline and where that pipeline sits geographically, which today is heavily weighted to the South (ConstructConnect).

For owners and developers, a 31% annual increase in the median cost per square foot is a budgeting issue for any project that was estimated a year or more ago (ConstructConnect). Electrical, mechanical and power scopes are the core of these buildings, and the parallel surge in power infrastructure starts suggests competition for the same electrical trades, switchgear and utility work. Data centers already make up about a quarter of nonresidential starts this year, echoing WCG's coverage of how megaprojects now hold one in four nonresidential construction dollars.

For general contractors outside the data center market, the concentration also matters. When one building type accounts for 27% of nonresidential starts, it draws on the same labor pool, equipment fleets and materials as hospitals, manufacturing plants and commercial work (ConstructConnect).

What to Watch

• Whether October starts rebound toward the 12-month average of $14.9 billion (ConstructConnect).
• Further revisions to August and September totals as project data is updated.
• How much of the $74.8 billion planned pipeline actually breaks ground in the next six months (ConstructConnect).

Bottom Line

Data center construction starts slowed in September after a record August, but the year is still on pace for more than $180 billion, and costs per square foot are rising about 31% year over year. Contractors should read the trend through the year-to-date and pipeline numbers rather than single months.

Key Questions

How much were data center construction starts in September 2026?

U.S. data center construction starts were $9.4 billion across 18 projects in September 2026, according to ConstructConnect (ConstructConnect).

What is the data center construction cost per square foot in 2026?

ConstructConnect put the median data center construction cost at $540.96 per square foot for January through September 2026, up 31% from a year earlier (ConstructConnect).

How much data center construction has started in 2026?

Data center starts reached $135.8 billion across 178 projects through September 2026, and ConstructConnect says the full year is on pace to exceed $180 billion (ConstructConnect).

Which region has the most data center construction?

The Wisconsin-to-Ohio corridor leads with more than $40 billion in 2026 data center starts through September, followed by the South Atlantic at $36.2 billion (ConstructConnect).

Related Coverage

• Megaprojects Hold One in Four Nonresidential Construction Dollars as August Sets Record
• September Construction Starts Dip 1.5% as Commercial Falls 18%
• Western New York's Data Center and Power Buildout: Where the Major Projects Stand in October 2026
• Palm Beach County Staff Approve Nearly 700,000 SF of Project Tango Data Centers

Image credit: imgix on Unsplash. Free to use under the Unsplash License. Representative image.

Sources

• ConstructConnect, November 2026 Data Center Report: September Adds $9.4B in Construction Starts, Costs Continue to Increase, https://news.constructconnect.com/november-2026-data-center-report-september-adds-9.4b-in-construction-starts-costs-continue-to-increase
• ConstructConnect, October 2026 Data Center Report: Spending Reaches $98.5 Billion, Construction Costs Rise, https://news.constructconnect.com/october-2026-data-center-report-spending-reaches-98.5-billion-ytd-construction-costs-rise