The data center boom is only going to accelerate in the months ahead as developers look to keep up with record levels of demand, according to a pair of reports released last week by CBRE and Synergy Research Group.

Cloud providers, social media companies and other corporate giants are hungrier for data center space than ever, and the industry’s already swollen development pipeline is going to have to grow further to meet the demand, the reports found.

According to CBRE, 2021 saw record leasing across major U.S. data center markets, with skyrocketing demand seemingly outpacing supply and almost half the industry’s construction pipeline already pre-leased.

Synergy's report on hyperscale data centers said that the number of large facilities under construction equals around 40% of the existing global supply and is expected to grow over the next three years. Analysts at both firms suggest that growth will be necessary to keep up with demand that will continue to trend upward.

“We expect continued strong data center demand from cloud service providers and social media companies in 2022 as these firms race to build out their digital infrastructure to support demand for cloud services and metaverse and other digital communities,” Pat Lynch, executive managing director for Data Center Solutions at CBRE, said in a release.

Data center leasing reached record levels in 2021, with 4.93 megawatts of net absorption in the top seven U.S. data center markets, according to CBRE’s most recent North America Data Center Trends report. That represented a 31% increase from 2019 and a 50% increase over the previous year.

The surging demand — driven largely by cloud providers like AWS and Microsoft and social media giants like Meta and TikTok — managed to outpace supply despite the continuing boom in data center development. Although overall inventory increased by 17% in 2021, the vacancy rate crept downward to 7.2%.

And while CBRE points to 728 MW of data center space currently under construction across the top seven U.S. markets, almost half of that space has already been pre-leased. The percentage of pre-leased space under construction in secondary markets is even higher.

These trends are echoed in Synergy data focused on hyperscale data center development, the vast majority of which is in the United States. According to Synergy, there are currently 314 hyperscale data centers being built globally, an enormous pipeline considering that only around 700 such facilities currently exist. Researchers at Synergy expect there to be more than 1,000 hyperscale facilities by 2025, and for the rapid growth to continue and possibly increase in the years that follow.

“The future looks bright for hyperscale operators, with double-digit annual growth in total revenues supported in large part by cloud revenues that will be growing in the 20-30% per year range,” John Dinsdale, a chief analyst at Synergy Research Group, said in a release. “This in turn will drive strong growth in capex generally and in data center spending specifically.”