Microsoft buys land in Leeds for £106.6m to build large-scale data center

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 of large-scale data.

The transaction will be paid in two cash tranches linked to phased completion. The conditions are typical for such transactions and the Group is confident that they will be met. The sale price is above the book value of the plot.

No further details have been revealed about Microsoft’s planned hyperscale data center at the Leeds site.

“This transaction further develops our expertise to include data centers and highlights the growing range 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 adjacent plots of land. Lot 1, which covers 27 acres, will be sold maintenance-free for approximately £52.9 million ($66.9 million), with the sale expected to be completed in the second half of 2024.

The book value of Parcel 1 as at 31 December 2023 was £39 million ($49.3 million). The group will be reimbursed around £500,000 ($632,000) for providing additional power capacity for the site. Harworth will handle the maintenance of Parcel 1 as development manager under a separate agreement, beginning after the transaction closes.

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

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

Interest in Leeds has increased this year. In March, Edge data center provider AtlasEdge announced the opening of its Leeds data center. The new LBA001 data center is located 4 miles from Leeds city center offering connectivity, colocation and cloud services.

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