The most important number in the U.S. construction industry is not the $9 billion Turner Construction booked on data center work last year. It is what happens to the national totals when you subtract that category and advanced manufacturing: flat or worse.
That is the hidden tension in the latest Census Bureau data. Apartment construction, the perennial favorite of developers and lenders alike, is no longer the engine of building activity. It is the drag. And the capital that would have gone into multifamily is being redirected into concrete slabs, backup generators, and fiber-optic trenches for AI workloads.
Turner Construction senior vice president Chris McFadden put a fine point on it: the firm expects data center revenue to more than double from $9 billion to over $20 billion by 2030. Turner is working on a $10 billion-plus project for Meta in Louisiana. That is not a side business. That is the growth line of the entire construction industry.
Meanwhile, Kast Construction in West Palm Beach is still recovering from a 30 percent revenue drop in 2023 when multifamily work collapsed. CEO Mike Neal says it took two years to rebuild, and most of the replacement work came from luxury condos and hospitality, not rental apartments. Eighty percent of Kast's revenue still comes from condo and rental construction, but the pipeline is thinner and the margins are tighter.
The capital markets implication is straightforward: institutional capital is following the path of least resistance and highest certainty. Data centers offer long-term leases, investment-grade tenants, and a demand curve that is not tied to household formation or interest rates. Multifamily offers rent growth that has decelerated, construction costs that have not, and a financing market where agency debt is available but expensive and construction loans are scarce.
The Census Bureau data shows multifamily as the fifth-largest private-sector construction category, behind single-family homes, manufacturing plants, power plants, and commercial buildings. That ranking is not a sign of health. It is a sign of how far multifamily has fallen relative to other capital-intensive sectors.
Cushman & Wakefield's Sam Tenenbaum notes that South Florida is still adding multifamily construction to its pipeline, but plenty of markets have pulled back enough to hurt contractor revenues. The national apartment shortage of 600,000 units, and the projected need for 4.3 million more by 2035, is a long-term demand story that does not translate into near-term construction starts when financing costs are high and rent growth is uncertain.
The capital that is flowing into data centers is not coming from the same sources that funded multifamily. It is coming from Big Tech balance sheets, private credit funds that underwrite to a different risk profile, and institutional investors who see AI infrastructure as a generational build-out. Multifamily lenders, by contrast, are still working through the maturity wall and watching rent growth compress in Sun Belt markets that were overbuilt in 2021 and 2022.
Who benefits from this shift? General contractors with data center expertise, like Turner, and the investors who own the land and power access near major fiber routes. Who is exposed? Multifamily developers who cannot get construction financing, and the subcontractors and material suppliers who depend on apartment starts for volume.
The market should watch whether data center construction begins to crowd out labor and materials for other building types. If the same concrete, steel, and electricians are absorbed by AI infrastructure, the cost of building anything else goes up. That is not a temporary dynamic. It is a structural reallocation of capital and capacity.
The U.S. construction industry is not in trouble. It is just building different things. The capital is following the demand, and right now, the demand is for shelter for machines, not people.