AI Data Center Development Shifts Toward Friendlier States
Summary
Uniti and Target Hospitality say post-midterm local consent is steering AI data center siting toward friendlier states, while rival Civeo says 8 of 10 opportunities stalled.
Local consent now shapes where AI data centers get built in the US. On their third-quarter 2026 earnings calls on November 9, 2026, fiber network operator Uniti Group (UNIT) and workforce-housing operator Target Hospitality (TH) both said that after the midterm elections, whether a state or town will accept a data center is steering where new campuses land: developers are moving toward friendlier jurisdictions and building measures to reduce the burden on local communities into their project plans [1][2].
After the election, local approval became a precondition for AI campus siting
Building an AI data center takes land and power, and it also takes the consent of the local government and residents. Developers used to compare power prices, grid-connection speed and land costs first, with approvals coming later. The November 2026 midterms changed that order. Texas governor-elect Gina Hinojosa plans to suspend new data center approvals until safeguards are established [3], and voters rejected data center projects in local ballot measures in many places [4]. Uniti's management also named New York, Maine, Michigan and New Jersey as states debating data center moratoriums [1].
For hyperscalers, the technology companies that build their own large data centers, site selection now has an extra hurdle. A new project either lands in a state or county willing to accept it, or expands an existing campus that already has power and permits. To win local approval, developers also need to explain where large numbers of outside construction workers will live and whether they will strain local housing and roads.
Two companies see the same shift, while a competitor reads it more cautiously
Target Hospitality, which builds and runs worker-housing communities at remote job sites, says its pipeline of potential business is following customers out of Texas. CEO Brad Archer said customers will take large projects to the most favorable environments, and that more and more opportunities sit outside Texas, in the Midwest, Nevada, Indiana and Ohio. He added that the company's ability to reduce strain on local housing and infrastructure directly addresses key concerns of state and local stakeholders [2]. On the August call he had already said that customers who once thought they did not need this kind of service were, because of pushback across the country, coming to the company earlier for help with community engagement [5].
Uniti sees the same change from the network side. The company said the states its fiber footprint covers are generally friendlier toward data centers, that it has seen a step up in data center-related conversations in those states since the election, and that if fewer data centers are built, the ones already built become scarcer [1].
The same constraint also has a more pessimistic reading. Civeo (CVEO), Target Hospitality's direct competitor, said on its October 30 call that roughly 8 of every 10 US data center accommodation opportunities had not materialized, for reasons including permits, water and power, and that the market will move slower than anticipated [6]. Taken together, these statements support a shift in where projects go, while the total number of new starts may fall at the same time.
Accepted campuses and support services are becoming scarce
If moratoriums and local rejections keep spreading, the scarce input is no longer just power but also land and campuses that communities have already accepted. Powered campuses with community support could command higher prices when they expand. Network and power companies that carry fiber and electricity into friendly regions could see more demand, and housing providers that can show they reduce the burden on communities could join project planning earlier. Conversely, suppliers concentrated in restrictive regions, or whose revenue tracks the number of new construction starts, face delayed orders.
For now these remain management views; no company's orders or revenue yet isolate an increase that comes from re-siting. Points to track include new contracts Target Hospitality signs outside Texas, new orders Uniti books in friendly states, and whether the Texas approval suspension is formally put in place.
Companies that could be affected
- Applied Digital (APLD): Owns powered AI data center campuses in North Dakota, Louisiana and Alabama. If new builds are restricted elsewhere, expansions at existing campuses like these could become more valuable. Voters in Harwood, North Dakota rejected a ballot measure opposing its $3 billion campus [7].
- MDU Resources (MDU): A North Dakota utility that serves Applied Digital's Ellendale campus, with more than 1 gigawatt of data center load signed [8]. If expansion concentrates at existing campuses that already have local acceptance, the added electricity demand could land on its grid.
- WillScot (WSC): Provides modular site offices and temporary facilities. Data center projects are about 18% of its pending order book [9], so that volume depends on how many projects local approvals ultimately allow to start.
Sources
[1] Drillr · Uniti Group (UNIT) · 2026-11-09 · Q3 2026 earnings call
Importantly, look, if fewer data centers are built, that just puts more of a scarcity value on the ones that are already built.
[2] Drillr · Target Hospitality (TH) · 2026-11-09 · Q3 2026 earnings call
[3] Digitimes · Texas governor-elect Gina Hinojosa plans to suspend new data center approvals · 2026-11-06 · News report · https://www.digitimes.com/news/a20261106PD223/texas-data-center-spacex-development-legal.html
[4] TechCrunch · Voters rejected data center projects in local measures in the midterms · 2026-11-07 · News report · https://techcrunch.com/2026/11/07/after-the-midterms-things-are-looking-rocky-for-elon-musk-and-data-centers/
[5] Drillr · Target Hospitality (TH) · 2026-08-10 · Q2 2026 earnings call
[6] Drillr · Civeo (CVEO) · 2026-10-30 · Q3 2026 earnings call
[7] Techmeme · Harwood, North Dakota voters reject ballot measure opposing Applied Digital data center · 2026-11-09 · News roundup · https://www.techmeme.com/261109/p17
[8] Drillr · MDU Resources (MDU) · 2026-11-05 · Q3 2026 earnings call
[9] Drillr · WillScot (WSC) · 2026-11-05 · Q3 2026 earnings call
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