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Accelerating data center capacity growth

Bring risk, insurance, and capital decisions into the build before they hold up delivery.

Fast data center builds leave less time to settle on who carries the risk, what insurance covers, and what lenders need to see.

AI demands have put a premium on bringing data center capacity online quickly, and competition between hyperscalers adds to the pressure. When you're working towards a committed delivery date, power connections, equipment procurement, construction milestones, and financing all need to come together, often with considerably less time between decisions than a conventional build out program would allow.

You may have an engineering, procurement, and construction (EPC) partner with a credible schedule in place. But that doesn't necessarily mean the insurance, financing, and contractual arrangements are moving at the same speed. Lenders may still need clarity on the exposures, while suppliers, contractors, and tenants may be working to different obligations and dates. With deadlines approaching, there is less room to resolve any differences.

The pressure to move faster can create problems. While an accelerated program can bring capacity online sooner, it can also leave commitments in place before the risks behind them have been properly assessed or allocated. Standard construction programs may not always account for those overlapping risk and capital considerations.

Marsh helps developers, operators, hyperscalers, investors, and lenders bring those considerations into the program early. By identifying potential exposures alongside construction and financing decisions, we can help clients understand what needs attention before it becomes harder to resolve, and support the progress of an accelerated project.

Why speed-to-market is now the battleground

AI workloads are pushing hyperscalers to secure more capacity, while competition for suitable sites, reliable power, and specialist equipment is making delivery timelines increasingly important. Securing a site or announcing a new development is different from having capacity ready for a tenant to use on the agreed date.

The investment figures put that pressure into perspective. Morgan Stanley Research estimates approximately $2.9 trillion in global data center capital expenditure between 2025 and 2028, including spending on infrastructure, chips, and servers. That is a considerable amount of capital going into the sector, and for developers, the time between committing that investment and bringing usable capacity online carries real commercial implications. Tenant delivery dates, expected revenue, and project finance assumptions may all depend on when capacity becomes available.

Speed-to-capacity is ultimately about closing that gap between development and operations. A faster construction program can help, but the facility still needs sufficient power, commissioned systems, and the contractual arrangements required to make that capacity available. The trouble is that these elements do not necessarily progress at the same pace, particularly when the overall timetable is being shortened.

The less time there is between major project milestones, the less room developers may have to resolve differences between procurement, construction, contractual commitments, and financing requirements before they begin affecting one another.

Why speed creates risk: the exposure window

When the timetable gets squeezed, decisions that would normally follow one another start happening at the same time. Long-lead equipment may be ordered while design details are still being settled, and construction moves forward before every contractor responsibility, insurance requirement, or contractual obligation has been agreed. This results in less room to resolve the questions that would usually get dealt with along the way.

That creates an exposure window, where a project has already made a commitment, but the arrangements intended to manage the associated risk have not quite caught up. Take a data center working towards a fixed commercial operation date, for example. Equipment is on order, the build is progressing, and the power interconnection is expected but not yet secured. If that date slips, commissioning and tenant handover can come under pressure even though the rest of the project may still be on track.

Getting equipment ordered early may help secure supply, but someone still needs to establish who carries the risk during transit and storage, when ownership transfers, and what happens if something is damaged before installation. Those details become harder to untangle once several suppliers and contractors are working to meet overlapping milestones.

Contracts bring their own set of complications. A promised tenant delivery date may not line up neatly with obligations under construction, equipment supply, and power agreements, with each carrying potentially different remedies for delay. Meanwhile, insurers and lenders may be working from an earlier version of the program, even though insured values, periods of exposure, or anticipated start-up dates have changed. By the time these differences become apparent, the developer may already face commitments that are difficult to rework.

The developers don’t have to slow down when capacity is needed. The risk comes when construction moves faster than the contractual, insurance, and capital decisions supporting it. Identifying those gaps earlier gives the project more room to address them before a delayed shipment, disputed obligation, or missed milestone begins affecting the wider program.

De-risking is a speed lever

When a project is already working against a tight deadline, another round of risk assessments, insurance reviews, and contract negotiations can feel like the last thing anyone needs. But lenders and insurers still need to understand the exposures they are being asked to address, no matter how quickly construction is moving. Leaving those questions until later can mean revisiting decisions the project thought were already settled.

A probable maximum loss (PML) analysis, for example, can give developers, investors, and lenders a defensible estimate of potential physical loss under defined scenarios. It helps inform builder's risk coverage and financing discussions without relying on broad assumptions about the project's value. And a delay-in-startup (DSU) analysis considers the potential financial consequences if insured physical damage pushes back completion and the start of operations. For a project with a committed commercial operation date, both can bring greater clarity to the insurance and financing position early on.

Contracts deserve just as much attention. Power purchase agreements (PPAs), service-level agreements (SLAs), and construction contracts may contain different delivery dates, performance obligations, and remedies for delay. Finding those mismatches before agreements are finalized is one thing; but trying to unwind them under a compressed schedule is quite another. As construction progresses, the insurance program may also need reviewing to reflect changes in sequencing, exposure periods, and anticipated start-up dates.

There is a practical advantage to getting this work done early. The loss estimates have more behind them, contractual responsibilities are clearer, and the insurance program can be considered against the build that is actually taking place. The schedule remains demanding, of course, but there is quite enough pressure on an accelerated project without discovering halfway through that its risk and contractual assumptions no longer reflect the program.

The capital tools that keep you moving

Getting the risk and contractual position in order helps, but an accelerated data center build still needs considerable capital before it begins generating revenue. Equipment purchases, contractor commitments, insurance premiums, and financial guarantees can all compete for funding, sometimes within the same tight window. When that happens, liquidity becomes another pressure on the construction schedule.

Marsh's Nimbus program is designed to address construction risks through the transition into operations, including delay-in-startup (DSU) coverage where applicable. For projects with phased completion, commissioning or handovers, it can help clients consider insurance requirements across the wider construction and handover process, subject to policy terms and eligibility.

Surety bonds and premium financing offer other options. Depending on contractual requirements, surety bonds may help meet performance or payment obligations while reducing reliance on certain cash-backed guarantees or credit facilities. Premium financing can allow eligible insurance premiums to be paid over time rather than entirely upfront. Both are worth considering when available capital is already supporting a demanding build schedule.

These arrangements cannot remove construction or financing risk, but they can give developers more flexibility in meeting project commitments. The wider coverage and financing considerations are explored in Marsh's data center risk management and insurance.

How Marsh helps accelerate your speed to market

A construction program can be planned down to the last milestone and still have some big questions sitting behind it. Marsh works alongside the delivery team to look at whether the risk, insurance, and financing arrangements are keeping up with the commitments already made.

A Marsh program risk review brings the construction schedule, contracts, financing requirements, and insurance arrangements into one assessment. That means looking at long-lead equipment, contractor dependencies, power commitments, and phased handovers to see where decisions in one part of the project may be creating exposure elsewhere. On a compressed program, those gaps are easier to address before another commitment is made.

Marsh's ARC framework brings assets, revenue, and contracts into the same picture. When is capacity expected to be ready, when does revenue begin, and what has already been promised to tenants or other counterparties? Those dates may look close enough on paper, but that doesn't necessarily mean the risks attached to them have been fully considered.

Where needed, Marsh can draw on expertise across its four businesses, bringing wider insurance, reinsurance, risk, capital, and strategy perspectives into the discussion. This helps developers, operators, and investors get a clearer view of the decisions that need attention while the construction team gets on with delivering the build.

Explore the connected exposures

Speed-to-market pressure can affect different parts of the data center lifecycle. Explore the connected areas in more detail:

Learn more

Why Marsh

Marsh currently works with 75% of the top 25 companies engaged in data centers and are a partner to 10 of the largest global technology companies by revenue. Our dedicated digital infrastructure integrates our extensive experience with energy providers — including grid, nuclear, and renewables — and deep relationships with contractors, private equity investors, and technology suppliers into one seamless practice.

Speak with a Marsh data center specialist

When the schedule is moving quickly, risk and capital decisions need to keep pace with delivery. Speak with a Marsh data center specialist about a program risk review and how early risk assessment can support your data center speed-to-market plans.

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Accelerating data center capacity growth

Fast data center builds leave less time to settle on who carries the risk, what insurance covers, and what lenders need to see.

Why speed-to-market is now the battleground