Data centers are eating up steel. Developers are now looking at timber.

By Sebastian Obando
Construction Dive
September 16, 2026
Category: Wood, Paper & Green Building
Region: United States

©Gensler

Surging steel costs and longer lead times are pushing data center developers to consider alternatives, Skanska executives said during a webinar. An expensive materials market is making one of construction’s less conventional alternatives worth another look. Prices for steel have climbed 25% over the past year, said Tom Park, vice president of the strategic supply chain at Skanska, during a Sept. 10 webinar on materials costs. Lead times, on the other hand, have more than doubled to 55 weeks. Blame the price jump on the rush to build data centers and semiconductor plants, Park said. “Very strong demand for steel and other metals because of the AI rollout,” he said. “Currently, both steel mills and steel fabricators are running at full capacity.” The demand, coupled with tariffs, mean contractors are now looking at mass timber as a way around those logistical bottlenecks, said Dean Lewis, director of mass timber and prefabrication for Skanska.

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