'Scale Is Key': Cushman & Wakefield Experts Talk Canadian Data Center Development At June 17 Event

Canada’s data center market is booming. Investment is flooding in, helping the sector work through bottlenecks in its development pipeline and creating new opportunities across the country.

“There’s a huge amount of capital flowing in,” said Cushman & Wakefield Global Data Center Advisory Group Vice Chairman Randolph Borron. “Even the smallest operators are well-funded. This will fuel the growth that needs to happen.”

In recent years, higher interest rates and strong AI demand in the U.S. delayed Canadian project starts across the country, leading to declining vacancy rates. Now developers are racing to meet surging demand.

“While demand and preleasing continued at the same rate or even escalated, capacity delivered in 2024 and 2025 has not kept pace with demand,” added Cushman & Wakefield Associate Vice President Michael Borron.

There is renewed interest in data center development across Canada from developers and the federal government. While Canada is positioned a few years behind the U.S. in the development cycle, this may offer a strategic market advantage as it allows the country to learn from trends and requirements and adopt more refined, forward-thinking approaches, Michael Borron said.

Randolph Borron will be moderating a panel at Bisnow’s Data Centre Investment And Expo (DICE) Canada to be held in Toronto on June 17. Michael Borron will also be speaking, delivering a keynote on the statistical trends impacting the industry’s growth.

Bisnow spoke with Randolph and Michael Borron to learn more about trends they are seeing. Register to attend the event here.

Bisnow: What are some differences between the Canadian and U.S. data center markets?

Michael Borron: Canada has a small population spread across a large land mass. As a result, it is a few years behind the U.S. in the development cycle. However, we’re able to learn from what is happening south of the border and to apply those lessons as we grow.

Bisnow: What does demand look like in Canada?

Michael Borron: In 2022 and 2023, interest rates started rising and capital demand for U.S. data center projects increased, resulting in a decline in new projects across the country. Since 2024, we’ve had a lower-than-average amount of capacity delivered across the country, leading to nearly everything that was constructed in this time getting preleased.

Bisnow: What does the pipeline of new facilities look like?

Michael Borron: There is an increase in project starts and investment, with an emphasis on projects in early stages without definitive timelines. The country needs infrastructure investment, and the federal government is working to address that.

Bisnow: Where is new supply likely to be concentrated?

Michael Borron: The most definitive pipeline of growth is in Ontario. There is also a lot of potential in Alberta, largely around Calgary.

The majority of data center development has focused on hyper-scalers. Now we are seeing renewed interest in colocation and enterprise facilities. We’re also seeing older facilities get expanded, densified and improved to accommodate increased demand. 

Quebec would have likely surpassed Ontario as having the largest data center market if they had not run into power capacity constraints.

Quebec generates an enormous amount of power, and they export billions of dollars of electricity to other markets, but the provincial government there has opted to favor other kinds of development that generate more jobs, like battery plants and automotive manufacturing, versus data centers. Data center investment and growth was flowing into Quebec, attracted by cheap green electricity, but that tap has largely been shut off.

Bisnow: What makes Canada's data center market unique?

Michael Borron: Our power grids, especially in Ontario, British Columbia and Quebec, are greener than many other markets globally, utilizing large amounts of hydroelectric, nuclear and renewables.

Canada is also politically and physically stable. Most of the country is isolated from physical risks like tornadoes, hurricanes and earthquakes.

Also, market participants who invest here can capture some savings, since the Canadian dollar is weak versus the U.S. dollar.

Bisnow: What advice would you give to people interested in entering this market?

Michael Borron: The companies that do well are those that are able to enter the market at scale, both in terms of number of facilities and number of markets. It’s an operating business, so those that have experience operating these facilities have an advantage.

It helps to have a team that is familiar with a given market and has experience operating in it successfully. In that sense, it’s like real estate alternatives, including self-storage or student housing. If you are looking to get involved in this industry long-term, it’s not a market to easily enter one site at a time. Scale is key.

Bisnow: Why is that?

Michael Borron: There’s a significant network effect. When users are looking to grow, they often look to grow in multiple markets around the world. The big players are global companies operating across multiple continents providing a scalable platform that can grow with their users.

Bisnow: Still, do you see many smaller players trying to enter the space?

Randolph Borron: Our phone is ringing off the hook. Everybody who owns a piece of land that might work as a data center site is calling. Potential clients are coming to us with their whole North American portfolio of land, retail buildings, industrial buildings, what have you, and asking us to review it for sites that could be good for data centers.

Bisnow: What impact will that have on the industry?

Randolph Borron: It's positive in the sense that a huge amount of capital is flowing into the industry. Even the smallest operators are well-funded. This will fuel the growth that needs to happen.

On the other hand, it means we’re also watching and waiting for the big mistakes to come to light. Big financial failures will happen because the market is moving fast. Historical data of how many megawatts of data center development should occur in a given region doesn’t exist yet. Folks are making giant bets and not going through proper site selection, so there will be fallout from that.

In Alberta, for instance, developers have to build power generation separate to the grid and there’s a lot of risk and time delays related to that.

We’ve also seen people build the wrong thing in a good location. The wrong density or the wrong business model for that given market. A simple mistake like that can cost tens, if not hundreds of millions of dollars.

Bisnow: What do you hope people take away from the event?

Michael Borron: My goal would be to encourage people to build. We still have more work to do and I hope the event unlocks more investment across Canada. Hopefully, the folks embarking on it take our business card to help them do it.

​This article was produced in collaboration between Cushman & Wakefield and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.