Richmond's Data Center Boom Is Outpacing The Nation — But Backlash Is Also Building

No American city is adding data centers faster than Richmond, Virginia, and the gap is only growing.

Richmond’s data center inventory surged more than sevenfold in the first half of the year, adding more capacity than any other U.S. market, according to Avison Young.

The region jumped from just over 100 megawatts to more than 800 MW in less than six months, transforming the capital city from a digital backwater into one of the nation’s most important infrastructure hubs.

But Richmond’s meteoric rise may be nearing its first real test.

The same factors that ignited its boom — cheap land, grid access and political will — are starting to generate friction. Power is tightening. Labor is limited. And after a blitz of megaprojects, residents and local officials are beginning to push back, reshaping the region’s once-permissive development environment.

That comes as a wave of new data centers is slated for the Richmond area and as growth accelerates amid mounting power constraints in Northern Virginia, the world’s largest data center market.

With power and land in short supply around the region's Data Center Alley, developers are moving south along the Interstate 95 fiber corridor toward Richmond. The result, Avison Young says, is a “string of pearls” of large-scale data centers rising in rural counties like Henrico, Louisa, Chesterfield and Hanover — places that, until recently, had seen little to no digital infrastructure.

By contrast, southern Virginia offers developers greater access to grid power and, where utility connections lag, the ability to tap natural gas infrastructure for on-site generation, said Howard Berry, Avison Young’s national director of data center solutions.

“It’s the availability of power,” Berry said. “That's why you see that trail going down, because there's gas and available power to develop in those markets.”

Since the start of 2025, Richmond has added 720 MW of new data center inventory, outpacing Dallas and Chicago combined, which together delivered 670 MW, according to Avison Young.

The surge in new capacity drove a parallel spike in leasing, with Richmond absorbing 650 MW — more than any other U.S. market.

The data center build-out in Richmond is just beginning. More than 9 gigawatts of colocation and hyperscale projects are planned or underway, which is set to dwarf the region’s existing inventory.

Development around Richmond is unfolding at a campus scale, with hyperscalers and major operators securing large tracts of land. Amazon has proposed a 1,143-acre, 11-building campus in Caroline County, along with two projects in Louisa County totaling more than 550 acres. In Hanover County, developer Tract is building a 1,200-acre site it says could eventually support 2.4 GW.

Other major players with projects in the region include Meta, QTS, Blue Owl Capital, Iron Mountain and DC Blox.

The wave of data center megaprojects around Richmond mirrors a broader industry shift as developers move into secondary and rural markets that were off the radar just two years ago.

Nearly half of last quarter’s largest data center deals took place in rural or nontraditional markets as developers chased power and natural gas access, according to Avison Young.

Secondary and tertiary markets like Richmond will lead data center growth in the months ahead, driven by available grid capacity and viable on-site power solutions, Berry said. He pointed to Pennsylvania, where planned projects have surged in recent months, many relying on behind-the-meter generation.

“This is a trend that we've seen across the map,” Berry said. “You see secondary and tertiary markets, places that have some power left, they just explode out of nowhere.”

But Richmond’s data center boom now faces growing headwinds that could temper its momentum, analysts told Bisnow. 

Power constraints that drove developers south from Northern Virginia are now emerging in southern Virginia as available grid capacity is quickly claimed, according to Howard Huang, a market intelligence analyst at Avison Young. He also cited a looming shortage of skilled construction and operations labor as a potential drag on growth.

For now, the most immediate threat to Richmond’s data center growth is rising local opposition, which is already influencing zoning and regulatory decisions, Huang said.

While organized resistance to data centers is growing nationwide, especially in saturated hubs, early projects around Richmond faced minimal local pushback. Many counties actively courted development.

But that political landscape has shifted in recent months as the pace of construction has sparked public concern over environmental impacts, electricity costs and the erosion of rural character.

In June, Henrico County revoked by right zoning for data centers and imposed new design rules after public backlash over the volume of large-scale proposals. In Chesterfield County, Tract withdrew its application for a 700-acre campus last month following negative feedback from the Planning Commission, though it plans to resubmit. Amazon Web Services also scrapped plans for a 1,370-acre campus in Louisa County in response to community opposition.

“It’s a lot of community and public pushback,” Huang said. “It’s gotten a lot of attention that data centers use a lot of power, and a lot of people are correctly concerned that it would affect their own personal utility costs or that it’s impacting the environment.”