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Brazil has long been the largest economy in Latin America, but in the digital infrastructure world, it has often lagged behind its potential. That may be about to change. In September 2025, the Brazilian government announced a sweepingexecutive order designed to attract trillions of reais in new digital infrastructure investment— with a major focus ondata centers.By exempting IT and capital equipment from major federal taxes and modernizing regulations, the government expects to unlock as much as2 trillion reais (US$377 billion)in digital investment over the next decade. If successful, this plan would transform Brazil into not just a regional leader but one of the world’s topcloud, colocation, and wholesale data center markets.This article explores what the incentives mean for data center development in Brazil, how they will reshape real estate and colocation markets, and why global hyperscalers and investors are paying close attention.Why Brazil Matters in the Data Center WorldThe Largest Market in Latin AmericaBrazil accounts for nearly half of Latin America’s GDP and has more than215 million people. With a fast-growing middle class and surging internet adoption, it represents the region’s largest consumer base for cloud services, fintech, e-commerce, and digital entertainment.A Connectivity GatewayBrazil’s coastline hostsnumerous subsea cable landingsthat connect Latin America to the U.S., Europe, and Africa. São Paulo and Rio de Janeiro are already regional interconnection hubs.Rising Enterprise DemandFrom banking to healthcare, Brazilian enterprises are rapidly digitizing. They needlocal hosting, colocation, and hybrid cloudto meet compliance, latency, and performance requirements.Inside the $377B Incentives PackageThe Brazilian government’s new framework has three key pillars:1. Tax Exemptions for IT and Data Center EquipmentThe order exempts critical infrastructure — servers, cooling equipment, power systems — from federal import taxes. This dramatically reduces the cost of building and operating data centers.2. Investment-Friendly RegulationThe plan streamlines permitting and offersfast-track approvalsfor large digital infrastructure projects. It also includesforeign investment protectionsto encourage international developers and REITs to enter the market.3. Long-Term Digital Economy GoalsBrazil is tying the incentives to its national digital transformation plan, aiming to expand cloud adoption, AI capabilities, and e-government services. Data centers are the backbone of this strategy.Who Will Benefit?HyperscalersMicrosoft, Google, Amazon, and Meta already operate data centers in Brazil. With the new incentives, they are likely toaccelerate regional expansionand possibly establishnew cloud regionsbeyond São Paulo.Colocation ProvidersCarrier-neutral colocation operators will benefit fromlower equipment costsand easier regulatory approval. This creates new opportunities to serve enterprises modernizing IT systems.Real Estate InvestorsThe incentives make Brazil one of the most attractive emerging markets fordata center real estate funds and REITs. With high demand and reduced CapEx, ROI potential is strong.Local EnterprisesBrazilian companies in fintech, telecom, healthcare, and retail will gain access to more local colocation capacity, enablingcompliance with data sovereignty lawswhile improving performance.Strategic Locations: Beyond São PauloSão PauloStill the country’s largest hub, São Paulo will see renewed investment thanks to its role as thefinancial and enterprise capitalof Brazil.Rio de JaneiroAs a cable landing site and energy hub, Rio will attract wholesale developments focused onconnectivity and sustainability.Northeast BrazilCities like Fortaleza are gaining prominence as subsea cable gateways, connecting Brazil to the U.S. and Europe. Incentives could drivenew edge campuseshere.Southern BrazilRegions like Paraná and Santa Catarina, with growing tech ecosystems, may also see new builds, diversifying Brazil’s digital footprint.Global Investor InterestPrivate Equity and REITsFunds that have already poured billions into U.S. and European campuses are now eyeing Brazil as the next growth frontier.Sovereign Wealth FundsMiddle Eastern and Asian sovereign investors, active in global digital infrastructure, are likely to join large-scale projects in Brazil.Development BanksInstitutions like the Inter-American Development Bank may also provide financing support, reducing risk for global players.Opportunities for Wholesale ColocationBrazil’s incentives create fertile ground forwholesale leasing. Hyperscalers seeking to expand quickly will prefer long-term leases inpre-built, AI-ready campuses. Providers that can deliver 50–100 MW campuses in São Paulo, Rio, and Fortaleza will capture the largest deals.This mirrors the trend seen in Asia-Pacific a decade ago, when incentives helped countries like Singapore and Malaysia attract mega-campuses.Challenges Brazil Must AddressPower ReliabilityWhile Brazil has abundant hydroelectric resources, grid reliability is uneven. Developers will needon-site generation, renewable PPAs, and microgridsto ensure uptime.Bureaucracy and ImplementationAlthough regulations are being streamlined, Brazil’s bureaucracy has historically slowed large projects. Consistent follow-through will be essential.Community EngagementDevelopers must engage local communities, especially in urban hubs, to address concerns about noise, energy use, and land development.Talent DevelopmentOperating advanced AI-ready campuses requires skilled technicians. Brazil must expandworkforce training programsto support growth.Why This Incentives Plan Is a Global Turning PointBrazil’s new framework is more than just tax relief — it’s asignal to the global market. By lowering barriers and providing clarity, Brazil is positioning itself to compete with top-tier global hubs.This could transform Latin America from asecondary growth regioninto aprimary destination for hyperscale investment, similar to what happened in Asia-Pacific after Singapore’s rise.The Road AheadIf executed effectively, Brazil’s $377B incentives plan will reshape the region’s digital economy. Enterprises will gain reliable local infrastructure, hyperscalers will expand services, and investors will tap into one of the fastest-growing markets in the world.The stakes are enormous. Brazil has the scale, the connectivity, and now the policy framework to become aglobal digital hub. The next decade will determine whether it fulfills that potential — and whether São Paulo, Rio, and beyond become as central to the digital economy as Northern Virginia or Frankfurt.

The U.S. data center landscape is shifting. For years, Northern Virginia, Dallas, and Silicon Valley have dominated headlines as the largest hubs of digital infrastructure. But in 2025, a new contender is emerging in an unexpected location: Wisconsin.Microsoft has announced a $7 billion expansion of its data center footprint in the state, building what it claims will be the world’s most powerful AI supercomputer campus. Anchored in Mount Pleasant and expanding across nearby sites, this project signals the rise of the U.S. Midwest as the next great destination for hyperscale development.With ties to artificial intelligence, GPU demand, and the reshaping of America’s digital geography, Microsoft’s Wisconsin investment is more than just another campus — it’s a blueprint for the future of hyperscale builds.Why Wisconsin? A New Digital FrontierStrategic GeographyWisconsin’s proximity to Chicago and the broader Midwest makes it an ideal regional connectivity hub. Enterprises and cloud users across the region gain low-latency access without depending on traditional coastal hubs.Power and Land AvailabilityUnlike saturated markets such as Virginia, Wisconsin offers abundant land parcels and power potential at competitive costs. For a project of this scale — hundreds of megawatts — these resources are critical.Government and Community SupportThe Wisconsin state government has actively partnered with Microsoft, offering incentives and streamlined permitting. Community leaders have positioned the project as a driver of jobs, tax revenue, and regional innovation.The AI Supercomputer AngleWhat makes this project groundbreaking is its AI-first design. Microsoft plans to host one of the largest GPU clusters in the world, powered by tens of thousands of Nvidia accelerators.Training Next-Gen ModelsThe facility will support training of massive generative AI models — the successors to GPT-class systems — requiring exascale-level computing.Power-Hungry, Density-DrivenAI racks demand 40–100 kW each, far beyond traditional enterprise densities. Microsoft’s Wisconsin campus is being built with immersion cooling and liquid-cooled GPU infrastructure to handle these loads.A Global BenchmarkIf delivered on time, this will be the largest AI-focused data center build in the U.S. Midwest, rivaling even coastal projects in scale and ambition.Economic Impact on WisconsinJobs and Workforce DevelopmentThe initial build will employ 500 people, growing to 800+ full-time jobs as operations expand. Microsoft is also investing in local workforce training programs to upskill residents in IT and data center operations.Supply Chain BoostRegional contractors, energy suppliers, and technology vendors will benefit from billions in spending. Local universities and research institutes are already positioning themselves as partners for AI innovation.Long-Term GrowthOnce completed, the campus will attract enterprises, colocation providers, and startups to the surrounding region, creating a digital ecosystem that didn’t exist in Wisconsin before.The Competitive Context: Why This MattersMicrosoft’s Wisconsin investment is part of a broader trend: hyperscalers are moving away from traditional hubs and into new regional markets.Northern Virginia remains the largest market but faces power and community pushback.Texas is booming, but land and energy costs are rising.Wisconsin offers a fresh canvas — affordable, scalable, and strategically located.This signals a decentralization of the U.S. data center map, with Midwest states rising as alternatives to crowded coastal hubs.Sustainability CommitmentsMicrosoft has pledged to operate the Wisconsin campus with 100% renewable energy, sourcing power from regional wind and solar projects. Water use is also being minimized through liquid cooling and recycling systems.By aligning the project with ESG standards, Microsoft not only meets regulatory expectations but also appeals to enterprises demanding green infrastructure.Lessons for Developers and InvestorsLesson 1: AI Is Reshaping Site SelectionHyperscalers are no longer just chasing cheap land and power. They need AI-ready campuses with high density, cooling innovation, and scalability.Lesson 2: Secondary Markets Are Now PrimaryWisconsin shows that secondary markets can attract multi-billion-dollar hyperscale projects if they offer the right mix of land, power, and incentives.Lesson 3: Public-Private Partnerships Are CriticalWithout government support, projects of this scale face hurdles. Incentives, streamlined permitting, and community engagement are now prerequisites.What It Means for Colocation and WholesaleWhile Microsoft is building for its own needs, the halo effect benefits the entire ecosystem. Colocation providers will likely expand nearby to support enterprises drawn to the new hub. Wholesale operators may also ride the wave, offering facilities to complement Microsoft’s footprint.Wisconsin could evolve into a multi-operator hub, similar to how Northern Virginia grew after early hyperscaler commitments.Global ImplicationsThe Wisconsin project is part of a larger global trend: hyperscalers are diversifying geographically. By investing outside traditional hubs, Microsoft reduces risk, enhances resilience, and sets a precedent for peers like Google, Amazon, and Meta.If Wisconsin succeeds, expect similar mega-projects in Illinois, Ohio, and other Midwestern states, turning the region into a critical backbone of the U.S. digital economy.The Road AheadThe $7B Wisconsin expansion is more than an investment — it’s a signal to the market. The AI era requires new geographies, new infrastructure designs, and new standards of scale.For developers, the lesson is clear: think beyond traditional hubs. For investors, it’s proof that hyperscalers are willing to back projects in emerging regions. And for enterprises, it’s a reminder that the U.S. data center map is expanding, creating new opportunities for colocation and hybrid IT strategies.Wisconsin may once have been known for dairy and manufacturing. In 2025, it’s positioning itself as the heart of America’s AI infrastructure revolution.

Every industry matures by learning from experience. The data center sector is no different. Over the past two decades, the industry has seen a transformation from small server rooms in corporate basements to global campuses consuming hundreds of megawatts. Along the way, developers, investors, and enterprises have gained valuable lessons about where and how to build.Today, in 2025, site selection for data centers is more sophisticated than ever. Power, connectivity, sustainability, community impact, and long-term scalability are all considered from the outset. While earlier projects sometimes underestimated these factors, the industry has used those experiences to build a smarter, more resilient foundation for the future.This article takes a positive look at how past developments shaped the modern approach to site selection, offering insights for anyone involved in colocation, wholesale leasing, or data center real estate.How Data Center Site Selection Has EvolvedFrom Basic Real Estate to Strategic InfrastructureIn the early 2000s, many data centers were built in retrofit spaces like office parks or industrial warehouses. Location was often based on real estate availability, not digital infrastructure requirements. Today, site selection is a strategic process involving utilities, governments, and long-term planning.The Rise of Power as the Primary FactorEarlier, connectivity drove site decisions. While still important, power availability and reliability now dominate the conversation. Developers recognize that without secured megawatts, even the best-located parcel cannot become a viable data center.Sustainability as a Core RequirementPast developments often focused solely on speed and cost. In contrast, modern projects integrate renewable energy, water efficiency, and community engagement into site selection. This shift reflects both regulatory trends and enterprise demand for sustainable infrastructure.Positive Lessons Learned From Past ProjectsThe Importance of Utility PartnershipsEarly projects that faced power constraints taught the industry the value of collaborating closely with utilities. Today, successful campuses are co-developed with utilities, ensuring grid upgrades, renewable integration, and long-term capacity planning.Community Engagement Builds TrustPast experiences with community pushback highlighted the need for transparency. Modern developers proactively engage residents, share sustainability goals, and emphasize local benefits such as jobs and tax revenue. This positive relationship accelerates project approval and builds goodwill.Designing for Future DensityLegacy facilities often struggled to support high-density workloads. The industry adapted by designing AI-ready, liquid-cooled environments. This foresight ensures today’s facilities can handle tomorrow’s demands without costly retrofits.Flexibility Through Modular ExpansionDevelopers learned that building too much capacity too early ties up capital. Now, modular designs allow phased expansion aligned with customer demand. This approach makes campuses more adaptable and financially resilient.Case Studies: Positive Evolution in Site SelectionNorthern Virginia: From Overload to OptimizationKnown as “Data Center Alley,” Northern Virginia taught the world the importance of planning around power. Early strain on utilities prompted a collaborative approach where operators, regulators, and communities now coordinate expansion. The result is a thriving ecosystem that continues to attract hyperscalers while addressing sustainability.Singapore and Malaysia: Turning Constraints Into OpportunitySingapore’s moratorium on new builds initially slowed growth. But the lesson was positive: neighboring Johor, Malaysia, became a beneficiary, creating a cross-border hub that balanced sustainability with scale. This demonstrates how challenges can lead to regional diversification.Kenya and Nigeria: Building for InclusionEarly African projects revealed challenges in connectivity and power. But these lessons fueled investment in subsea cables and renewable generation. Now, Nairobi and Lagos are poised as continental leaders, showing how early challenges can spark long-term infrastructure gains.What Enterprises Gain From These LessonsConfidence in Colocation ProvidersEnterprises benefit from a more mature industry. Providers now plan facilities with compliance, density, and sustainability in mind from day one, giving enterprises confidence in long-term stability.Improved Hybrid IT StrategiesBetter site selection means colocation facilities are strategically located near cloud on-ramps, enabling seamless hybrid strategies. Enterprises can run workloads where they perform best.Stronger ESG AlignmentModern colocation and wholesale providers integrate renewable PPAs and water-efficient cooling, supporting enterprise ESG goals. This alignment strengthens partnerships and reputation.The Investor PerspectiveFor investors, the evolution of site selection has reduced risk and created new opportunities:Predictable Returns – With power and demand carefully analyzed, projects are more stable.Scalability – Modular campuses allow capital to be deployed in phases, aligning with tenant demand.Global Diversification – Lessons from early concentrated hubs have encouraged broader geographic spreads, reducing exposure to single markets.Investors today enter a market that is more disciplined, more strategic, and more future-focused than ever before.The Future of Site SelectionLooking ahead, several positive trends are shaping the next era:Integration of Nuclear and Renewables – On-site generation with solar, wind, and small modular reactors will redefine power availability.AI-Driven Planning – Predictive analytics will help developers model demand, latency, and sustainability outcomes with precision.Community-Centric Design – Data centers will increasingly function as part of local ecosystems, contributing heat recovery, jobs, and digital inclusion.Global Balance – Rather than concentrating in a few mega hubs, data centers will spread to secondary markets and emerging economies, creating a more balanced digital map.Why These Lessons Matter in 2025The story of data centers is no longer about missteps or failures — it’s about how the industry has learned, adapted, and improved. Every challenge in the past 20 years has contributed to a stronger foundation for growth.For enterprises, this means colocation choices are safer and more aligned with business goals. For investors, it means the asset class is maturing into core infrastructure. And for developers, it means projects are smarter, more sustainable, and more scalable.The takeaway is clear: the positive lessons from past data center developments are guiding us toward a future where site selection is precise, partnerships are stronger, and digital infrastructure is built to last.

In 2025, colocation is no longer a niche IT strategy. It’s a mainstream infrastructure solution powering enterprises, hyperscalers, and startups alike. As workloads shift to hybrid models, colocation provides the backbone of digital transformation — offering secure, scalable, and interconnected environments.But with demand booming, the market has become crowded. Enterprises face dozens of providers promising everything from AI-ready facilities to sustainability leadership. Choosing the right colocation partner is one of the most critical infrastructure decisions an enterprise can make. The wrong choice can mean poor performance, high costs, and compliance risks. The right choice can enable growth, agility, and long-term stability.This playbook outlines how enterprises should evaluate colocation providers in 2025, highlighting key criteria, common pitfalls, and practical strategies to separate marketing promises from operational reality.Why Enterprises Still Turn to ColocationHybrid IT DemandsCloud-first doesn’t mean cloud-only. Enterprises are blending public cloud, private cloud, and colocation to optimize cost, performance, and compliance. Colocation serves as the anchor point for hybrid IT, connecting workloads across environments.AI and High-Density NeedsAI adoption is accelerating. Enterprises need GPU-ready environments with liquid cooling and high rack densities. Colocation providers that deliver these capabilities give enterprises the ability to scale without building costly private data centers.Compliance and Risk ManagementIndustries like healthcare, finance, and government face strict regulations. Colocation ensures physical control and compliance while still offering ecosystem connectivity.The Top Evaluation Criteria for Colocation ProvidersPower and Cooling CapabilitiesEnterprises must assess whether a provider can deliver:High-density racks (40–80 kW) for AI and HPCRedundant power systems (N+1 or 2N)Advanced cooling (liquid, immersion, rear-door exchangers)A provider without sufficient density and cooling cannot support future workloads.Connectivity EcosystemCarrier-neutrality is critical. Enterprises should look for:Multiple carriers and cloud on-rampsDark fiber access for redundancyLow-latency interconnection optionsThe richer the ecosystem, the more flexibility and resilience enterprises gain.Geographic FitLocation matters. Enterprises should evaluate:Proximity to users or HQs for latencyCompliance with regional regulationsRisk factors like natural disasters or political stabilityThe wrong geography can add cost and complexity.Security and CompliancePhysical and logical security must align with enterprise needs:Tiered access controls, biometric verificationCompliance certifications (ISO, SOC, HIPAA, GDPR)24/7 monitoring and incident responseScalability and Growth PotentialColocation is a long-term play. Enterprises should ensure providers can:Expand within the same campusDeliver phased builds to match demandProvide transparent pricing for future growthFinancial and Operational ConsiderationsPricing ModelsEnterprises should understand:Power pricing (metered vs. flat rate)Cross-connect costsRack and cage flexibilityHidden fees often turn affordable deals into budget risks.Provider StabilityFinancially strong providers with diversified portfolios reduce risk. Enterprises should review:Balance sheets and funding sourcesTrack record of delivering large projectsCustomer referencesService and SupportColocation is not just real estate. Support quality matters:Remote hands availabilityCustomer portals and transparency toolsSLA commitments for uptime and response timesThe Role of Sustainability in EvaluationSustainability is no longer optional. Enterprises face ESG reporting requirements and investor scrutiny. Colocation providers must demonstrate:Renewable energy commitments and PPAsWater-efficient cooling strategiesCarbon-neutral or net-zero roadmapsProviders with credible sustainability strategies will win more enterprise contracts in 2025.Pitfalls to Avoid When Choosing a ProviderChasing Low Cost Alone – The cheapest option often sacrifices reliability or scalability.Ignoring Ecosystem Value – Connectivity is as important as space and power.Overlooking Long-Term Contracts – Enterprises must align contract terms with IT strategies to avoid lock-in.Failing to Future-Proof – Providers without AI-ready capacity may not meet needs three years from now.Practical Steps for EnterprisesDefine Requirements Clearly – Power density, compliance, and geographic needs must be documented.Request Transparent Pricing – Demand clarity on power, cross-connects, and future expansion costs.Visit Facilities – On-site tours reveal more than brochures.Check References – Speak directly to customers with similar workloads.Align Contracts With Strategy – Ensure flexibility for hybrid cloud, AI adoption, and global expansion.Case Studies: Choosing the Right PartnerFinancial Services Firm – Chose a colocation provider in Frankfurt with strong compliance certifications and direct cloud on-ramps, enabling hybrid strategies while meeting GDPR.AI Startup – Selected a provider in Silicon Valley with immersion cooling capabilities to support GPU training clusters. The ability to scale density was the deciding factor.Healthcare Enterprise – Opted for a provider in Virginia with renewable PPAs, ensuring HIPAA compliance and sustainability alignment.These examples show how evaluation must match specific enterprise needs, not generic promises.Why the Market Is Crowded — and What That MeansThe surge in colocation demand has attracted both established players and new entrants. From global REITs to regional providers, the competition is intense. For enterprises, this is an opportunity — competition drives better pricing, richer ecosystems, and more sustainable practices.But it also creates noise. Marketing claims are everywhere, and not all providers can deliver at scale. Enterprises must rely on rigorous evaluation frameworks to separate leaders from laggards.The Future of Enterprise ColocationAs workloads diversify and AI becomes mainstream, enterprises will rely more heavily on colocation. Providers will evolve into digital ecosystems, not just landlords. Evaluation will increasingly focus on:AI readiness and density supportRenewable-powered campusesGlobal interconnection platformsEnterprises that choose wisely will gain a strategic advantage, accessing the infrastructure needed to innovate and compete. Those who don’t risk being locked into outdated or underpowered environments.