Joy Wiltermuth at Morningstar tells her readers that AI is fueling a gold rush in new data centers, the hottest buildings in real estate. Wiltermuth writes:
Forget glitzy skylines, the new bright spot in commercial real estate is workforce housing for computers that can whirl data into artificial intelligence.
The latest hot spots in commercial real estate aren’t in Manhattan or Miami.
Instead of snazzy hotels or glistening office towers, the new property darlings are power-hungry data centers, often in places like Northern Virginia; Columbus, Ohio; and Salt Lake City.
Traditionally box style, these buildings are all about function: A place for racks and racks of computers to be stacked up high, kept cool, and girded for the boundless stream of images, videos, chats, text, internet searches and the digital detritus of our lives. […]
Power-hungry AI
ChatGPT, which reached an estimated 100 million monthly users in its first two months, can generate text, images and more. Enthusiasm on Wall Street for all things AI provided rocket fuel to shares of chip-maker Nvidia Corp. (NVDA) and other “Magnificent Seven” tech stocks.
Listen: Nvidia’s path from videogame darling to AI powerhouse server maker Super Micro Computer Inc. (SMCI) has been among the latest stocks to benefit. And AI also has a hyper-focus on real estate that can handle the boom.
“It’s already past being niche,” said Patrick Wilson, a portfolio manager who has specialized in data centers for more than a decade at global real-estate investors CenterSquare Investment Management. […]
“As we see it, data centers are becoming AI factories with data as the input and intelligence and insights as the output,” Ganzi said.
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