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The partners say they expects to pre-lease the new London colocation facility to hyperscalers

This week, real estate investment firm Segro has announced a new joint venture with Pure Data Centres to build a £1 billion data centre facility in Park Royal in west London.

The 30,000sqm facility will have a capacity of 56MW, which will be leased to tenants that provide and manage their own server equipment.

The data centre will be owned equally by Segro and Pure DC. Segro will provide the industrial site with its associated power infrastructure, while Pure DC will outfit the facility with the power and technology infrastructure required to host data centre servers.

The joint venture is expected to sign a long-term lease agreement of more than 15 years with a global hyperscaler.

“This innovative joint venture with Pure DC allows us to develop our first fully fitted data centre, alongside a highly experienced partner with an excellent track record of delivering world-class facilities to global hyperscalers,” said David Sleath, chief executive of Segro.

“SEGRO choosing to enter into a joint venture with Pure DC for its first fully fitted data centre development demonstrates our capability to create world-class digital infrastructure. Together we will develop a 56MW data centre in central London capable of handling next-generation cloud and AI workloads,” added Dame Dawn Childs, CEO of Pure DC.

In total, the data centre project is expected to require a combined investment of £1 billion, with Segro providing an initial £150 million.

The data centre market has boomed over the past year, driven by a surge of AI-related investment and the subsequent demand for cloud compute power. While the construction of these new facilities carry major challenges – such as land and renewable energy availability – they also offer margins “too large to ignore”, according to Sleath.

Construction of the facility is expected to start next year, with commercial availability beginning from 2029. The construction process itself is expected to generate hundreds of jobs.

“This announcement is another powerful endorsement of Britain as a home for tech investment, which will not only bolster the local economy and create job opportunities but also pave the way for a digital and AI-powered future,” said Secretary of State for the Department of Science, Innovation & Technology (DSIT), Peter Kyle MP. “Private investment like this innovative partnership between SEGRO and Pure DC will help us ensure the UK has the digital infrastructure it needs to thrive, helping us harness the power of technology to grow the economy and raise living standards, the central missions in our Plan for Change.”

How is the data centre boom impacting the North of the UK? Join the industry in discussion at the Data Centre Summit, co-located at the Connected North conference in Manchester

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