(MENAFN- FTI Consulting) Data centre developers worldwide are rapidly shifting their focus to the construction of facilities capable of supporting artificial intelligence (AI) workloads – but sector experts are warning that the complex requirements of these new data centres may be outpacing supply chain preparedness.

The 2025-2026 Data Centre Construction Cost Index from global professional services company, Turner & Townsend, reveals 83 percent of data centre industry experts do not believe supply chains are well equipped to deliver the advanced cooling technology required for AI data centres.

Based on expert insight from 280 data centre industry professionals across 52 worldwide markets, the report points to 2025 as an inflexion point for the sector as it moves from a focus on traditional cloud-based, air-cooled data centres to the growing dominance of high-density, liquid-cooled facilities to support AI workloads.

Meanwhile, 48 percent of respondents cited power availability as the most prominent obstacle to delivering projects on schedule – a concern amplified by the ever-increasing power-density of AI data centres. In hot climates like Saudi Arabia, liquid cooling and direct-to-chip systems are essential for sustainability and performance.

Beyond the survey, the report’s cost index compares construction costs between global data centre markets. The Middle East remains cost-competitive globally, with Saudi Arabia at US$11.3 per watt (ranking 18th globally) and UAE at US$9.2 per watt (46th), compared to the two most expensive locations, Tokyo and Singapore at US$15.2 and US$14.5 per watt, respectively.

The Middle East is fast becoming a global hub for digital infrastructure, with data centre capacity set to surge from 1.2 GW this year to 3.3 GW by 2030. Growth is being fuelled by hyperscale demand, stronger regulations, rising investment, and the rapid expansion of AI workloads. Major projects in the region include Khazna’s rollout of AI-ready facilities, du’s hyperscale data centre in the UAE, and HUMAIN’s plan, backed by Saudi Arabia’s Public Investment Fund, to add 1.9 GW of capacity by 2030.

However, inflation of 5 percent in Riyadh, Dubai, and Abu Dhabi for 2025 has signalled growing pressure on budgets as demand accelerates. Regional cost escalation continues to be driven by labour shortages, supply chain constraints, and rising demand. While inflation is due to reduce in 2026, developers are encouraged to adopt modular construction, local sourcing, and phased development to maintain cost efficiency and accelerate time to market. Turner & Townsend also advises clients to explore off-grid solutions, renewable integration, and battery storage to mitigate risks and align with environmental goals.

Alan Coary, Data Centre Lead, Middle East, at Turner & Townsend, said:

"The Middle East is emerging as a global digital infrastructure powerhouse, with data centres driving ambitions in AI, cloud and digital sovereignty. Capacity is set to triple by 2030, fuelled by hyperscale demand and the rapid growth of AI workloads.”
Alan continues:

“Saudi Arabia and the UAE are driving this transformation with government-led initiatives and robust regulatory frameworks accelerating expansion. The Kingdom is targeting 6.6 GW of AI computing capacity by 2034, reflecting its national vision for technological leadership. Meanwhile, the UAE is raising the bar with pioneering developments like Moro Hub’s solar-powered data centre and Stargate UAE, a flagship initiative in Abu Dhabi.

"As the region continues to grow, data centres have become strategic assets, accelerating digital transformation and positioning the Middle East as a global leader in digital infrastructure and innovation.”

Globally, construction costs for traditional cloud-based data centres have stabilised, averaging 5.5 percent in 2025, a sizable drop from the 9.0 percent year-on-year increase reported in 2024. Notably, for the first time, Turner & Townsend has identified a 7–10 percent cost premium between traditional and AI-ready data centres by comparing projects of similar IT capacity, underscoring the impact of advanced technical requirements.1

MENAFN11112025003212009242ID1110325511