Microsoft has submitted a planning application to Leeds City Council for a £106.6 million hyperscale data centre campus at the former Skelton Grange power station site in Stourton, marking one of the largest tech infrastructure investments in Yorkshire’s history.
The hybrid application seeks full planning permission for three data centre buildings, each spanning approximately 424,000 square feet, alongside associated energy infrastructure, power systems and landscaping. Microsoft also seeks outline permission for 160,000 square feet of warehouse and distribution space on adjacent land. This Leeds tech startups story positions Leeds as a critical hub for cloud computing and artificial intelligence infrastructure supporting the UK’s digital economy.
The development is expected to create 163 full-time jobs once operational, with 93 positions at national level and 70 locally. The project team includes Savills, architects TTSP, and engineering consultants HDR and Ramboll.
Leeds Tech Startups Benefit from Digital Infrastructure Investment
Microsoft’s data centre will power cloud computing services and artificial intelligence operations, requiring substantial electricity supply and sophisticated cooling systems to manage heat generated by server operations. The site’s strategic location provides access to national grid connections and major water infrastructure necessary for large-scale data centre operations.
The planning statement submitted with the application emphasises economic benefits. “There will be very important economic gains from the scheme, in terms of the creation of jobs and because of the vital role that data centres play in supporting the wider economic infrastructure and the growth of the digital economy at a local, regional and national scale,” it states.
Microsoft acquired the 48-acre site from Harworth Group for £106.6 million across two transactions, with the first 27-acre plot completed in December 2024 for £52.9 million. The second 21-acre plot is due for completion in early 2026 for £53.2 million. This Leeds tech startups infrastructure investment supports the broader digital economy by providing computing power and storage for businesses across Yorkshire and beyond.
The Skelton Grange site, which housed coal-fired power stations built in the 1940s and 1960s before closing in 1994, has been remediated by Harworth Group since its 2014 acquisition for £3 million. The site has previously been considered for a Leeds United stadium and a High Speed 2 depot.
Why this matters for Leeds
Microsoft’s data centre application represents the largest technology infrastructure investment Leeds has secured, validating the city’s position as a viable alternative to London for hyperscale computing facilities. The 163 jobs created will be high-value technical roles in data centre operations, cybersecurity and infrastructure management, strengthening Leeds’ tech employment base. More importantly, hosting Microsoft Azure infrastructure could attract software companies, cloud-native startups and AI developers, potentially catalysing a cluster of digital businesses around the facility and reinforcing Leeds’ ambitions to become a Northern technology hub.
