Rising political and community resistance to data centers is decelerating sector-wide growth, prompting developers and their financiers to prioritize local concerns more heavily. "The community pushback is real," said Maria Goodpaster, a partner at McKinsey & Company, noting, "It is certainly slowing down the pace because some investments have already been made, and now we are seeing companies pivot or, in some cases, abandon their chosen sites."

Goodpaster stated on Wednesday that the availability of power and water resources has now become a critical component of commercial feasibility assessments, directly influencing capital allocation and site selection. Infrastructure bottlenecks are further exacerbated by shortages of essential equipment such as high-voltage transformers and backup generators. This dynamic is making speculative development increasingly challenging, while simultaneously commanding higher premiums for projects that have secured grid interconnection rights and locked in customer demand.

"Data center development has undergone an evolution, initially understood more as a real estate play, but now viewed as infrastructure assets that require a host of supporting conditions to align simultaneously," said Kate Dorsey, Managing Director at Stonepeak.