The AI boom had persuaded many Asian governments to aggressively court data centers by offering tax breaks, discounts on land and easy access to power and water. Big tech companies like Microsoft and Amazon have pledged billions of dollars for new data centers and AI infrastructure across Asia.

Although companies are clamoring for capacity, “there are physical limits to how quickly you can build data centers at scale,” Kevin Guan, chief investment officer and executive vice president of Bain Capital-backed Bridge Data Centres said at the Fortune Leaders Forum in Macau on Sept. 8.

In the U.S., the industry faces “significant delays and challenges with delivery,” he added. “Demand far exceeds the supply here in Asia as well.”

“There’s a lot of pushback at the moment in many parts of the world. I think we’re all having to respond, and it’s only right that we do so,” said John Taylor, global critical facilities leader and principal at the architecture firm Gensler. “We need to move data centers from being perceived as industrial infrastructure to being something which is part of the civic infrastructure, which serves a community.”

In land-constrained Asian cities, data centers are already being built up to heights of 10 or 11 stories and sited close to residential areas, Taylor said. Clients are also experimenting with diverting excess data center heat to warm swimming pools in winter.

Data centers typically require massive amounts of freshwater to keep computer chips cool. In Johor, Malaysia, Bridge Data Centres built a wastewater treatment plant on its campus to recycle municipal wastewater, minimizing its impact on the city’s potable water supply.

“What we don’t use, we return to the community in the form of clean water,” Guan said.

Data center operators and designers are also grappling with mismatched timelines. Data center buildings are designed to last as long as 20 years, while the latest AI chips may last less than five. Guan said Bridge is using modular construction materials to ensure that the hardware housed inside buildings can be swapped out “like pieces of a Lego brick” as needed. 

Despite efforts to improve their sustainability, data centers continue to rely on energy generated by fossil fuels, raising questions about the net environmental impact. Roughly 56% of the energy consumed by data centers worldwide comes from coal and natural gas, according to the International Energy Agency.

That’s posing a challenge to corporate climate targets. Gensler, for example, has committed to zero carbon by 2030, and Taylor didn’t pretend the AI boom is making that easier. “That’s looking extremely challenging,” he said. 

Clarification, Sept. 10, 2026: This article has been updated to clarify that Kevin Guan was talking about the broader data center industry, rather than Bridge Data Centres specifically, as well as the U.S. market.