Why are data center REIT stocks rising this week?

Investors are rotating into rate-sensitive real estate after December Federal Reserve signals pointed to easing in 2026, which generally lowers discount rates used in REIT valuation models. At the same time, demand from AI training and inference is driving stronger multi-megawatt leasing and interconnection growth. Names like Equinix, Digital Realty, Iron Mountain, and American Tower have benefited as analysts highlight improving 2026 cash flow visibility. Reuters and Bloomberg market wraps this week attribute gains to both macro rate expectations and AI-driven leasing momentum.

How does AI infrastructure spending impact Equinix and Digital Realty?

Higher AI infrastructure spending boosts wholesale and campus pre-leasing, particularly where operators control power-secured land. Equinix sees tailwinds through xScale and interconnection density, while Digital Realty benefits from build-to-suit campuses and asset recycling that funds expansion. Industry firms like IDC and Dell’Oro expect hyperscale capex to grow at a mid-teens pace in 2026, sustaining absorption and supporting rent uplifts. These dynamics have triggered positive estimate revisions and contributed to recent stock outperformance in both names.

What risks could stall the data center stock rally?

Power constraints and grid interconnect delays in markets such as Northern Virginia, Phoenix, and parts of Texas remain the primary risks, potentially pushing out delivery timelines. A reversal in bond yields or tighter financial conditions could also compress REIT multiples. Regulatory permitting or community opposition can slow site development. Finally, supply chain setbacks for power equipment or AI servers could defer customer readiness, affecting near-term leasing conversion. CBRE’s late-2025 updates emphasize the power bottleneck as the gating factor.

Why is GDS Holdings showing bigger percentage moves than U.S. peers?

GDS Holdings is more sensitive to balance-sheet developments and restructuring signals, which can drive larger day-to-day swings. Recent media coverage citing portfolio optimization and liquidity milestones attracted speculative inflows, resulting in outsized gains relative to U.S. REIT peers. As an ADR focused on China and APAC data centers, GDS also reacts to regional macro news and currency factors. Reuters’ Asia market reports this month highlight how incremental financing updates have catalyzed sharp short-term rallies in the stock.

What should investors watch next for this sector?

Key watch items include hyperscaler capex disclosures, secured megawatt announcements, and updates on substation energization timelines in core markets. Investors should track interconnection growth at Equinix and CoreSite, large-campus pre-leasing at Digital Realty and Iron Mountain, and any power procurement wins that de-risk 2026 deliveries. Macro catalysts include upcoming inflation prints and policy commentary that influence REIT multiples. IDC and CBRE reports due in early 2026 will also shape expectations for absorption and pricing power across regions.

Equinix Gains as Data Center REITs Rally on Rate Bets and AI Demand

Data center landlords climb as investors rotate into rate-sensitive REITs and analysts lift AI infrastructure spending estimates. Equinix, Digital Realty, Iron Mountain, and American Tower move higher while GDS Holdings surges on restructuring momentum.

Published: January 11, 2026 By David Kim Category: Data Centers

Equinix Gains as Data Center REITs Rally on Rate Bets and AI Demand

Executive Summary

Data center REITs advance as investors price in lower U.S. rates and rising AI-driven leasing, with shares of Equinix and Digital Realty up roughly 3–6% over recent sessions, according to market data trackers Reuters.
Analysts flag stronger 2026 AI infrastructure outlays, with hyperscale capex projected to grow in the mid-teens, according to recent industry updates from Dell’Oro Group and CBRE.
Iron Mountain and American Tower trade higher on continued leasing momentum and interconnection demand, while GDS Holdings rebounds on balance-sheet progress reported in media coverage.
Power constraints and grid interconnect delays remain a headwind in top markets like Northern Virginia, prompting selective market reactions to greenfield announcements, per CBRE and utility filings cited by Bloomberg.

Market Snapshot And Movers Equity markets are rewarding rate-sensitive data center landlords as cooling U.S. inflation and December Federal Reserve signals on future cuts support REIT valuations; shares of Equinix and Digital Realty are higher by an estimated 3–6% over the past week, while broader REIT benchmarks also advanced, Reuters reported following recent Fed communications in December 2025. Investors are also digesting stronger leasing pipelines tied to AI workloads that continue to lift near-term sentiment for interconnection and hyperscale assets, according to CBRE’s late-2025 market updates.

The rally extends to data center-adjacent operators. Iron Mountain trades firmer on expectations for sustained multi-megawatt signings and record colocation demand reported in recent quarters, while American Tower gains as investors re-rate the value of its CoreSite data center business tied to cloud and enterprise interconnect growth, per sector coverage compiled by Bloomberg. China-focused GDS Holdings...

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