Data center development is no longer constrained by real estate or demand—it is constrained by power.
In Part One of the Marshall & Stevens Data Center Forum, the discussion focused on how power availability is reshaping capital formation, site selection, and overall project feasibility. That session established a clear shift: data centers are now being evaluated as integrated energy and infrastructure platforms, not just real estate assets.
Part Two builds on that foundation, moving from the “power-first” thesis into execution. The conversation examines how developers and investors are addressing the practical challenges of delivering capacity—site selection, energy strategy, modular construction, supply chain constraints, and tax structuring—and how these decisions affect timelines, cost, and long-term value.
Watch Below
Speakers
- Fernando Sosa, Managing Director, Marshall & Stevens (Moderator)
- Charles Miller, President & CEO, NgenX Energy
- Akash Deshpande, Founder & CEO, SkyBlue AI
- Anthony Festa, National Practice Leader – Machinery & Equipment, Marshall & Stevens
- Paul Costanzo, Director of Mission Critical, Kais-AIR
- Dino Barajas, Chair of Project Finance Practice Group Americas, Baker Botts
Overview of the Discussion
This session examines how data center projects are being planned and executed in an environment where traditional assumptions—particularly around power access and development timelines—no longer hold.
The panel begins with site selection, where power availability, fiber connectivity, water access, and tax structuring now determine whether a project is viable. Securing tax abatements and infrastructure alignment early is presented as a foundational step, not a secondary consideration.
The discussion then moves to energy strategy. Grid power is no longer sufficient on its own, leading to increased reliance on behind-the-meter generation, bridge power solutions, and hybrid approaches. In some cases, developers are effectively building power plants alongside data centers, changing both the capital structure and risk profile of projects.
Modular development emerges as a key theme. Rather than building full-scale facilities upfront, developers are phasing capacity—bringing smaller increments online to generate revenue sooner while maintaining flexibility as technology and demand evolve.
The panel also addresses supply chain constraints, evolving rack densities driven by AI workloads, and the increasing role of energy storage in stabilizing both facility performance and grid interaction.
Key Takeaways
Power availability now dictates feasibility
Access to power—whether through the grid, natural gas, or on-site generation—is the primary constraint in development. In many markets, grid timelines extend several years, forcing alternative strategies.
Data centers are becoming energy infrastructure projects
Developers are no longer just building facilities—they are deploying large-scale power systems with significant capital cost, operational risk, and tax implications.
Modular development improves speed and flexibility
Phased deployment allows operators to bring capacity online faster, align capital spending with demand, and adapt to changing technology requirements.
AI is reshaping design assumptions
Higher rack densities and fluctuating power loads require new approaches to cooling, energy storage, and electrical design.
Supply chain and policy risk must be modeled early
Equipment lead times, regulatory changes, and tax considerations are actively influencing project timelines and financial models.
Tax strategy directly affects project economics
Tools such as cost segregation, PILOT agreements, and energy incentives can materially improve returns when structured early in the development process.
Why This Matters
A consistent theme throughout the discussion is that early planning—across power, tax, design, and procurement—is critical to project success.
Data center development now requires coordination across multiple disciplines, each with its own timeline and risk factors. Decisions made at the site selection or design stage can materially affect:
- Time to market
- Capital efficiency
- Long-term operating costs
- Regulatory exposure
- Asset value and financing flexibility
Projects that treat these elements as integrated—not sequential—are better positioned to move quickly and avoid costly redesigns or delays.
Related Services
Data Center Valuation & Advisory Services
Supports feasibility, valuation, and investment decisions across complex data center assets and infrastructure.
Cost Segregation
Helps accelerate depreciation and improve after-tax project returns, particularly for equipment-heavy facilities.
Machinery & Equipment Valuation
Provides defensible values for power systems, cooling infrastructure, and IT assets used in financing, insurance, and tax reporting.
