Harworth Group agrees £106.6m land sale to Microsoft for new ‘hyperscale’ datacentre

There are two parcels of land on the site. Plot one, which comprises 27 acres, will be sold on an unserviced basis for approximately £52.9m. Completion of the sale is targeted for the second half of this year.

The second plot, which comprises 21 acres, will be sold on a serviced basis for approximately £53.2m. Completion of the sale is targeted for the first half of 2026.

There is no current rental or other income associated with the land.

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Harworth will use the proceeds from the sale to develop new industrial and logistics space from its strategic landbank for its investment portfolio.

Harworth purchased the former Skelton Grange power station site in December 2014 for about £3m, with remediation and enabling works commencing shortly after.

Harworth secured approval in November 2023 for 800,000 sq ft of industrial and logistics space, and most recently in May 2024, a reserved matters approval for a further 320,000 sq ft of industrial and logistics space.

In 2020 it completed a 19.5-acre land sale to Enfinium, on which it is developing a 49MW energy-from-waste renewable electricity generation facility for its own operation, and the grant of a lease in 2021 for the development of a 100MW Battery Energy Storage System on a 5.7-acre demise.

Harworth acquired a further 21 acres of adjoining land in 2023 to enhance the development potential of the overall scheme.

Upon completion of the transaction, including anticipated cost plan spend, Harworth will have invested about £36.7m in the site and generated £135.7m of sales. The group will retain 16 acres on which to promote about 250,000 sq ft of employment space. This is in addition to the 77 acres owned by way of joint venture with The Aire Valley Land at a neighbouring development, Gateway 45.

Once the development is complete, Skelton Grange is expected to provide about 250,000 sq ft of industrial and logistics space, a hyperscale datacentre, a BESS facility, an EfW facility, and about 28 acres of land returned to a natural habitat alongside improved green travel infrastructure, which Harworth estimates will represent in excess of £4 bn of inward investment providing a substantial boost to the local economy.

Lynda Shillaw, chief executive of Harworth Group, said: “Since re-listing in 2015 Harworth has successfully completed a number of significant transactions that create value for our shareholders but this sale at Skelton Grange is the Group’s largest to date and is yet another exemplary case study that demonstrates the successful regeneration of brownfield land.

"It highlights Harworth’s capabilities in identifying and acquiring complex sites, creating planning-friendly masterplans that maximise site potential, and deploying timely and effective investments into remediation and infrastructure.

"This transaction further builds our expertise to include datacentres and evidences the growing spectrum of industries that continue to be attracted to the schemes that Harworth brings to the serviced land market.”