Tritax Big Box REIT enters data centre power market to capture AI and cloud opportunity

Tritax Big Box REIT has announced its entry into the data centre market with the acquisition of a 74-acre site near Heathrow Airport, marking a significant strategic expansion beyond its traditional logistics portfolio. The company plans to develop what is expected to become one of the UK’s largest data centres, capitalising on growing demand driven by cloud computing and artificial intelligence adoption.

The ambitious project, located within the Slough Availability Zone, will deliver up to 147 megawatts (MW) of power capacity across two phases. The initial phase, targeting completion in the second half of 2027, will comprise a 107MW facility spanning 448,000 square feet of data halls across three floors. A potential second phase could add another 40MW of capacity to the site.

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To accelerate power delivery to the site, Tritax has formed a joint venture with a leading European renewable energy generator, circumventing the typical decade-long wait for grid connections. The company expects the first phase to cost approximately £365 million, including land acquisition, construction, and power infrastructure costs.

This is a decisive and exciting first step for the Company in the very attractive data centre market which the Manager has unlocked with its power and real estate capabilities,” said Aubrey Adams, Chairman of Tritax Big Box.

“This gives the Company a considerable competitive advantage in capturing the growing demand for data centre infrastructure. The combination of Manor Farm’s prime London location and accelerated access to critical grid connection agreements creates the opportunity to develop quickly one of the UK’s largest data centres and deliver exceptional returns for our shareholders.”

In addition to this initial project, Tritax Management has a pipeline of additional opportunities across the UK with potential power capacity of around one gigawatt, highlighting the scale of its ambitions in the sector. These additional projects could begin delivery from 2028 onwards.

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Global demand for data centres is projected to grow between 19-22% annually until 2030. Tritax’s entry into this market presents a fascinating opportunity for investors seeking exposure to the UK’s AI industry.

The development is expected to generate attractive returns, with Tritax targeting a 9.3% yield on cost for the first phase. This significantly exceeds the typical 6-8% yield target for its logistics developments, reflecting both the prime London location and the scarcity of powered land suitable for data centre development in the area.

Construction of the first phase is scheduled to begin in the first half of 2026, subject to planning permission and securing a pre-let agreement. The planning decision is expected in the second half of 2025.

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