NEW YORK — The rapid rise of data center construction took center stage at New York Build 2026, where contractors, developers and industry experts gathered to discuss opportunities and ongoing challenges shaping the sector.
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While the surge in demand driven by artificial intelligence and cloud computing continues to fuel growth, panelists at the event emphasized that constraints such as power availability, community opposition and data quality remain critical hurdles for builders.
Construction Dive attended multiple panel discussions at the March event, where four key themes emerged as defining issues for the industry.
As data center construction accelerates, public sentiment is becoming a decisive factor in project approvals, particularly in dense urban areas like New York City.
Panelists noted that contractors can no longer rely solely on technical expertise and speed to secure projects. Instead, developers must incorporate community benefits into project planning, including infrastructure upgrades and improvements to local power grids.
Without that support, projects risk delays or cancellations due to political resistance. Some regions are already exploring stricter controls. New York is considering a potential moratorium on large-scale data center developments, while Maine has proposed legislation to pause such construction through 2027.
“We should be saying yes, but with the right requirements,” said Rob LoBuono, principal at design firm Gensler, during the expo.
At the same time, access to reliable power has emerged as the industry’s most significant bottleneck. Panelists highlighted that hyperscale data centers can require more than 1,000 megawatts of power at a single site, placing immense strain on existing infrastructure.
“We’re at a point in time where if you don’t make these upgrades you’re going to miss out on one of the largest infrastructure booms we’ve seen in our lifetimes,” said Kelly Bacon, vice president and data center market lead at AECOM.
As a result, developers are increasingly exploring alternative energy solutions such as battery storage and nuclear power, while also shifting focus toward smaller, colocation facilities and regions with greater energy capacity, including upstate New York.
Beyond infrastructure challenges, panelists underscored the growing role of artificial intelligence and robotics in improving construction efficiency — while warning that these tools are only as effective as the data behind them.
Inconsistent models and poor coordination can undermine even the most advanced technologies. Vincent Poon, VDC department manager at Structure Tone, emphasized this point with a familiar phrase: “garbage in, garbage out.”
Successful projects, panelists said, integrate technology into a continuous feedback loop. Robots scan installed work, compare it to digital models and feed the data into AI systems that identify discrepancies and guide corrective action. This approach enhances execution and improves how project information flows across teams.
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Meanwhile, the urgency to deliver projects faster — particularly in the data center sector — is driving widespread adoption of prefabrication and modular construction techniques.
By shifting work offsite, contractors can mitigate labor shortages, improve quality control and accelerate project timelines. For many developers, these methods are no longer optional but essential to remain competitive.
“We have to preengineer, preplan, prefabricate quite a bit of our systems. In the building itself, we’re seeing a lot of prefabrication,” said LoBuono. “We’re actually seeing that as the only way right now to achieve the market speed that’s being driven in this economy for data centers.”
Panelists also warned that the stakes are higher on these technologically complex projects. Failures that might be manageable in traditional construction — such as leaks or system errors — can result in significant financial losses in data center environments.
As demand for digital infrastructure continues to surge, insights from New York Build 2026 highlight a construction sector balancing rapid innovation with mounting logistical, regulatory and community challenges.
Originally reported by Sebastian Obando, Reporter in Construction Dive.
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