The Real Bottleneck in America’s AI Boom Isn’t Chips, It’s Power

• Power play: AI’s growth is shifting to the states whose power grids can handle its massive energy demands.

• Refi riptide: A booming wave of refinancing is squeezing investors and widening bond spreads and driving up mortgage rates.

• Breach of interest: A cyberattack on real estate finance technology firm SitusAMC may have exposed critical client data.

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Industrial

The Real Bottleneck in America’s AI Boom Isn’t Chips, It’s Power

America’s AI boom is no longer anchored to Silicon Valley. A new map of 214 GPU-heavy data centers shows a startling realignment: the country’s most powerful clusters are rising across Southern and Midwestern states where land is cheap and electricity is (mostly) plentiful.

Those advantages are already hitting hard limits. Texas, Tennessee, and Indiana have built enormous concentrations of AI compute—but in some of these states, a handful of clusters could swallow a third or even half of total annual electricity production. The grid, not the talent pipeline, is now the constraining factor.

And the pressure is spilling into courts, utilities, and local politics. Lawsuits, surcharges, nuclear-power disputes, and community pushback all point to the same shift: AI’s next phase will be defined by energy availability, not geography. The future of the industry will rise—or stall—where the grid can keep up.

Overheard

A Quiet Corner of Real Estate Just Had a Very Loud Breach

A cybersecurity breach at SitusAMC has put an uncomfortable spotlight on one of the real-estate industry’s most unglamorous but essential functions: the back-end systems that keep loans moving and deals closing. Early reports say banks and even federal investigators are trying to understand the scope of the attack. For now the public picture is thin, yet the firm has confirmed that parts of its internal data environment were compromised enough to require system repair and a full restoration before operations resumed.

SitusAMC’s position in the market helps explain why this incident is getting so much attention. The company is the product of a 2019 merger between Situs, a long-standing commercial real-estate advisory shop, and American Mortgage Consultants, a residential due-diligence and tech specialist. Combining those two created one of the largest infrastructure providers in both commercial and residential finance—data plumbing that institutional lenders rely on every day.

There is still more unknown than known, but the language on SitusAMC’s own site hints at something more than a routine intrusion. The company says “corporate data associated with your relationship with SitusAMC such as accounting records and legal agreements has been impacted. Certain data relating to your customers may also have been impacted.” That’s the kind of disclosure that makes lenders rethink who’s holding what and how well protected it really is.

A Surge in Refinancing Is Inflating Mortgage Costs Across the Market

A sharp drop in mortgage rates has triggered a refinancing bonanza, especially among homeowners who secured their loans when rates were closer to 7%–8%. Activity is surging, helped by better digital processes and aggressive outreach by nonbank originators. But this wave isn’t just benefiting individual borrowers — it’s also raising costs for everyone else in the mortgage market. Because so many people are prepaying their older, higher-rate loans, investors in mortgage-backed securities are forced to reinvest at lower yields, pushing them to demand higher spreads — and ultimately contributing to higher mortgage rates.

What’s really remarkable is the speed. Data shows that as of October, the prepayment rate on Freddie Mac loans that were only 6–24 months old is accelerating faster than it did a year ago — meaning a lot of borrowers aren’t just refinancing; they're doing it fast when the economics make sense. Nonbank lenders, in particular, are grabbing more of this, leveraging their servicing relationships: their retention rate for refinancing their own customers is more than double that of traditional banks.

As early prepayments pile up, investors demand more yield, which broadens the spread on agency mortgage-backed securities. That feeds directly into mortgage rate pricing, making loans harder to get for everyone — even for multifamily owners. It also underlines how much power lies with servicers who retain customers, their ability to push a large volume of refis could create ripple effects for the entire securitization market. In short, what looks like a refinancing win for some homeowners may represent a more expensive world for future borrowers.

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Propmodo Daily is written and edited by Franco Faraudo with contributions from readers like you and the Propmodo team.

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