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Microsoft purchases Leeds land for £106.6M to build a hyperscale data centre

Written by Thu 27 Jun 2024

Land and property regeneration company, Harworth Group, has agreed to sell 48 acres of its Skelton Grange site in Leeds to Microsoft for £106.6 million ($134.7 million) to create a hyperscale data centre.

The deal will be paid in two cash tranches, tied to phased completion. The conditions are typical for such transactions, and the Group is confident they will be met. The sale price is above the plot’s book value.

No additional details about the planned Microsoft hyperscale data centre at the Leeds site was revealed.

“This transaction further builds our expertise to include data centres and evidences the growing spectrum of industries that continue to be attracted to the schemes that Harworth brings to the serviced land market,” said Lynda Shillaw, Chief Executive at Harworth Group.

The Disposal Plot consists of two adjoining land parcels. Plot 1, covering 27 acres, will be sold on an unserviced basis for approximately £52.9 million ($66.9 million), with the sale expected to be completed in the second half of 2024.

Plot 1’s book value as of 31 December 2023, was £39 million ($49.3 million). The Group will be reimbursed around £500,000 ($632,000) for securing extra power capacity for the site. Harworth will handle the servicing of Plot 1 as the development manager under a separate agreement starting after the transaction is complete.

Plot 2, comprising 21 acres, will be sold on a serviced basis for approximately £53.2 million ($67.3 million), with the sale anticipated to be completed in the first half of 2026. Its book value as of 31 December 2023, was £12.9 million ($16.3 million), with forecasted servicing costs totaling £5.1 million ($6.4 million).

Harworth purchased the former Skelton Grange power station site for around £3 million ($3.7 million) in December 2014 and began remediation and enabling works soon after. 

Interest in Leeds as risen this year. In March, Edge data centre provider, AtlasEdge, announced the opening of its Leeds data centre.  The new LBA001 data centre is situated four miles from Leeds city centre, offering connectivity, colocation, and cloud services.

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Written by Thu 27 Jun 2024

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