ENDATA CENTERS, COMMERCIAL REAL ESTATE & CONSTRUCTION FINANCE · NOVEMBER 4, 2026
Data-Center Construction Brings Growth and Cost Pressure to Regional Firms
A Richmond Fed survey found 31% of Fifth District respondents involved in data-center construction, with directly involved firms reporting faster input-cost, selling-price, and wage growth than uninvolved firms.
What the Richmond Fed published
Source publication date: November 3, 2026. The Richmond Fed analyzed responses from 376 firms in its October business surveys. Sixty-nine percent reported no involvement in data-center construction, while 31% reported some involvement: 18.6% directly, 8.4% indirectly, and 4% both directly and indirectly. The Fifth District survey is regional and does not represent every market, contractor, developer, or property.
- 0118.6% were directly involved
- 02Most involved firms had under 10% revenue exposure
- 03Direct participants reported 9.7% input-cost growth
Most involved firms reported limited revenue concentration
Among firms with direct or indirect involvement, approximately 68% said data-center activity generated less than 10% of revenue. Twenty-four percent of directly involved firms reported 10% to 50% of revenue from data centers, compared with 15% of indirectly involved firms. Five percent of involved firms reported at least half of revenue from the sector. Even limited average exposure can conceal substantial customer or project concentration at an individual company.
Growth came with faster cost and wage pressure
Directly involved firms reported average input-cost growth of 9.7% over the prior year, compared with roughly 6.7% among indirectly involved and uninvolved firms. Direct participants reported prices charged rising 6.4%, below input-cost growth. Wage growth was 4.2% for directly involved firms, 4.0% for indirectly involved firms, and 3.4% for uninvolved firms. The net share expecting higher employment was also greatest among direct participants.
Practical borrower and investor takeaway
Map each data-center customer, project, contract, backlog item, payment milestone, retainage, change-order right, performance obligation, and cancellation exposure. Update labor, materials, power, interconnection, water, land, insurance, tax, and completion assumptions. Stress slower awards, delayed utility capacity, cost increases that cannot be passed through, customer concentration, and refinancing risk, then preserve contingency and liquidity for the downside case.
Data-center borrowers, contractors, suppliers, and investors should document contract exposure, customer concentration, pricing power, labor, power and utility dependencies, cost escalation, and downside liquidity rather than relying on sector growth alone.
Discuss a financing need →This independent summary is based on the cited source and is provided for general educational purposes only. Terms and program requirements may change.