Georgia data centers use more than power and land. They need warehouse space.

Data centers and their demands on power, land and water have become thorny political issues and are largely unpopular with the public. But advocates say the complexes have spinoff benefits for the economy, including tax revenue and high-paying jobs. The demands of data centers have helped fill empty buildings and softened the blow from a warehousing slump.

Last year, across Atlanta and five other major U.S. markets, firms tied to data centers accounted for 14.4% of all industrial leases signed in those markets, which is a record, Cushman & Wakefield said. It’s also a 44% increase from 2024 — nearly double the rate of any other sector’s growth — and it’s only projected to increase further as more hulking data centers come online in the U.S. to power AI.

Metro Atlanta emerged three years ago as the country’s fastest-growing data center market. It’s also among the areas where this warehouse-leasing trend is most prevalent, according to Cushman & Wakefield’s analysis. And so far in 2026, data center-related companies are on record pace to lease even more warehouse space in the Atlanta area.

“Behind that are several industrial suppliers that are fueling those (data center) construction projects and then maintaining them once they’re built,” Lisa Pittman, executive managing director in Cushman & Wakefield’s Atlanta office, told The Atlanta Journal-Constitution.

The surge in warehousing needs for data center suppliers is a newfound ripple effect of the industry flocking to Georgia. Jack Chapman, development manager in Atlanta for commercial real estate firm Transwestern, called it “a new animal within the industrial real estate market.”

“We’re seeing the offshoots of that data center growth show up with the companies that work on those projects and supply those parts needing warehouse space,” he said.

Credit: Ben Hendren

Credit: Ben Hendren

Atlanta’s industrial market was red-hot after the COVID-19 pandemic roiled supply chains and supercharged e-commerce demand as online purchases surged. That prompted a record amount of warehouse development in 2021 and 2022 to meet that demand.

The data center boom picked up the baton after OpenAI launched ChatGPT in late 2022, creating its own tidal wave of demand from Big Tech firms to bolster their AI operations. Atlanta has experienced a frenzy of data center construction over the past three years, rising to become the country’s second-largest market behind only Northern Virginia, according to real estate services firm CBRE.

During this time frame, companies supplying and supporting data center projects have leased millions of square feet of traditional warehouse space in the Atlanta area. The sector has typically leased about 2.5 million square feet of new space each year, according to Cushman & Wakefield, but Dallas and Phoenix experience stark increases in 2025.

In the first six months of this year, data center-related companies leased 1.4 million square feet of space in the Atlanta market, which is a record pace and represents 8% of all new industrial leasing in the region.

“Understanding (AI’s) economic impact means looking beyond the buildings themselves to the broader industrial ecosystem that enables them,” said John McWilliams, head of data center insights at Cushman & Wakefield. “Those multiplier effects are becoming increasingly meaningful for developers, occupiers and the communities where this investment is taking place.”

Cushman & Wakefield broke data center-related companies into three categories. The top group includes companies leasing warehouse space for the sole purpose of supporting data center development or operations. This encompasses wiring, cabling and fiber optics logistics along with other forms of supplying power equipment.

The other two categories feature data centers as a defined customer base but to lesser degrees. The lowest-rung category includes construction materials and other infrastructure that is used across development types, including computer server farms.

Credit: Hyosub Shin/AJC

Credit: Hyosub Shin/AJC

David Kaplan, head of asset management for Atlanta-based industrial developer Stonemont Financial Group, said the emergence of the data center industry has impacted traditional industrial developers. While it has created a new customer stream of demand for warehouse space, it’s also a competitor for construction labor, materials and project sites.

Appealing data center sites, which have sometimes demanded nine-figure prices in Georgia, have distorted the land market in some areas, Kaplan said. He said the same thing happened once the warehouse construction frenzy cooled off after 2022.

“A lot of landowners are still living in a 2022 mindset and thinking their land is more valuable than what the market is willing to pay today,” he said. “… There’s a bit of a disconnect between the buyers and sellers.”

Cushman & Wakefield’s analysis also found that the leasing spillover effects of data centers create more jobs than the server farms do within their walls.

Despite their size, most data centers only employ a few dozen full-time employees for maintenance, security and engineering work after they’re built. But Cushman & Wakefield found that every new job within a data center supports 2.5 other jobs elsewhere in the local economy, often at suppliers and third-party contractors. A fourth of those ancillary jobs are in trade and logistics, a boon industry for Georgia bolstered by its ports, interstate system and the world’s busiest airport.

“Data centers should be modeled not as traditional labor-intensive industrial uses but as infrastructure projects that generate a range of broader regional economic impacts,” the Cushman & Wakefield analysis concluded.