The Retail Colocation Market is expanding rapidly as enterprises shift from on-premise data centers to third-party facilities, seeking efficiency, flexibility, and high-performance connectivity amid growing cloud and edge computing adoption.

Austin, Nov. 10, 2025 (GLOBE NEWSWIRE) — The Retail Colocation Market Size was valued at USD 11.72 billion in 2024 and is expected to reach USD 36.95 billion by 2032 and grow at a CAGR of 15.4% over the forecast period 2025-2032.

Retail colocation is an essential component of the global digital infrastructure ecosystem, which is being driven by the ongoing growth of cloud, edge deployments, and connectivity services. Large corporations and SMEs may deploy swiftly, configure power flexibly, and lease physically smaller spaces using retail colocation services.  The growing need for cloud services and artificial intelligence (AI) capabilities among businesses is a major factor propelling the market. The demand for reliable, scalable, and secure data center infrastructure is on the rise as enterprises drive digital transformation. With instant access to power, connection, and cooling infrastructure, retail colocation facilities offer a more affordable option than building customers’ data centers.

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The U.S. retail colocation market size was worth USD 2.80 billion in 2024 and is expected to reach USD 7.90 billion by 2032, growing at a CAGR of 13.86% over 2025-2032.

It has the greatest demand for cloud and artificial intelligence services, a greater concentration of IT giants, and an excellent digital infrastructure. Silicon Valley, Dallas, and Northern Virginia are the largest data center hubs, with dependable power and connection.

By End-User, Large Enterprises Segment Held the Largest Market Share in 2024; Small and Medium-Sized Enterprises (SMEs) to Grow with the Fastest CAGR

In 2024, large enterprises accounted for 61% of the retail colocation market share due to their massive IT workloads, data needs, and global presence. This increase is driven by digital acceleration, economic scaling of resources, and other rising demands for safety against cyberattacks. Small and medium-sized enterprises (SMEs) are witnessing the fastest growth in the retail colocation market, with a CAGR of 16.10%.

By Industry Application, Market is Dominated by the IT and Telecom Segment in 2024; Healthcare Segment to Grow with the Fastest CAGR Globally

In 2024, the IT and telecom sector led retail colocation usage with a 37% market share, fueled by explosive data growth and demand for low-latency services. The healthcare segment is growing fastest, with a CAGR of 16.5%, as hospitals and medical providers digitize operations and adopt telehealth.