Growing public and political resistance to new artificial intelligence data centers could prove an unexpected tailwind for the real estate investment trusts that already own and operate them, according to analysts and industry trackers.
Protests have emerged across the U.S. as hyperscale cloud providers push to build facilities to train and run AI models. The centers consume vast amounts of land, electricity and water — and generate noise that nearby residents often oppose. With midterm elections approaching, the debate is only expected to intensify. A recent NBC News poll found that 69% of respondents oppose AI data center construction in their area.
There are already more than 4,700 data centers nationwide, a number expected to grow sharply. PwC projects annual data center spending will rise to roughly $1.8 trillion by 2050 from about $800 billion in 2026. Some states have introduced legislation to restrict or ban new construction, and New York has enacted a moratorium.
While hyperscalers dominate headlines, data center REITs offer another way to play the AI buildout. These companies act as landlords, developing and leasing space to multiple tenants including Amazon, Apple and Oracle, according to Nareit, the industry association for REITs.
Mizuho analyst Vikram Malhotra said in a Sept. 1 note that political and community pushback could delay new projects but that this could actually benefit existing data center REITs, which have pricing power driven by continuously expanding compute demand.
Data center REITs represent about 13% of the total U.S. REIT market capitalization of $1.5 trillion, per Nareit. The publicly traded REITs own roughly 275 data centers in the U.S., less than 10% of the owner-operated and leased centers nationwide.
Three names dominate the index
The FTSE Nareit Equity REITs Index includes three data center stocks: Digital Realty Trust, Equinix and Iron Mountain. All three have raised guidance after second-quarter results came in above expectations.
Equinix — which recently signed a deal with Nvidia — is the largest of the three, with a market value of roughly $102 billion. It offers a 1.99% dividend yield and shares are up about 37% year to date. The company reported adjusted funds from operations above analyst forecasts in July and raised its full-year outlook.
Digital Realty Trust has a market cap of $71 billion, yields 2.59%, and is up more than 23% in 2026. It also beat on adjusted FFO in July and lifted its full-year guidance.
Iron Mountain yields 2.96%, has climbed 42% this year, and carries a $34.7 billion market cap. Second-quarter AFFO topped expectations, and the company raised its full-year guidance as well.
Pushback cuts both ways
The data center resistance story is nuanced, said Amanda Martinez, an analyst at Wells Fargo Investment Institute. On one hand, limiting new supply could raise the value of existing capacity, benefiting incumbent REITs. Developers with land banks that are already permitted and have secured power would gain a relative edge if new projects become harder to build.
“On the other hand, permitting restrictions and moratoriums could weigh on future growth by slowing development timelines and pushing up costs,” Martinez said.
David Guarino, an analyst at real estate research firm Green Street, is bullish on Equinix and Digital Realty. He noted that their size gives them flexibility. “If there is restriction or pushback in a certain market, they’ve got big land banks and big development pipelines, where they can pivot to other markets,” he said. Their long track records also mean they have established relationships with local municipalities, which can help when seeking approvals.
Guarino prefers Equinix over Digital Realty, although both are doing “incredibly well.” He pointed to the coming shift toward AI inference — the lower-latency, real-world applications of AI — which would benefit companies that focus on smaller tenant leasing closer to population centers. “That’s a lot more of Equinix’s business than Digital Realty’s business,” he explained.
Alex Pettee, president and director of research at Hoya Capital Real Estate, is also constructive on data center REITs from a supply-demand perspective. Both Equinix and Digital Realty are in Hoya’s model portfolios. He acknowledged that a moratorium can hurt if it stops a specific project, but he emphasized the bigger picture: “If zoning gets tougher, power gets harder to secure, and communities don’t want new facilities, the data centers that are already there become more valuable.”
While these stocks trade at premiums to other REITs, Pettee argues they look attractive relative to the broader AI trade.
“You’re getting double-digit earnings growth, tangible real estate and infrastructure, recurring contractual revenue, and a roughly 2%-3% dividend yield,” he said.
Source: www.cnbc.com — https://www.cnbc.com/2026/09/08/these-dividend-stocks-could-catch-a-tailwind-from-data-center-pushback.html
This article is for informational purposes only and does not constitute financial, investment, tax, or legal advice. Do your own research and consult a licensed professional before making financial decisions.
