Telehouse pays over £220m for Docklands site to build 65MW data center

Telehouse and its parent KDDI Corporation have closed a £220 million ($294m) purchase of the Inventory Estate in East London to build a 65MW data center. The deal, completed with sellers LaSalle Investment Management and Trilogy Real Estate, expands the company's existing Docklands campus at 2 Clove Crescent.

The site currently holds two office buildings totaling 483,000 sq ft (44,862 sqm). Planning consent is already in place for a 376,000 sq ft (35,000 sqm) data center on the land. The new facility is described as high-density and AI-ready.

What did the executives say?

Mark Pestridge, managing director of Telehouse Europe, said: "The purchase of the Inventory Estate represents an important step in the long-term development of our London Docklands campus, one of Europe's leading connectivity hubs. It provides space for future expansion to support our customers' digital growth ambitions, including the crucial innovation that is taking place across industries such as healthcare, education, and financial services."

Pestridge added: "As demand for AI-ready infrastructure grows, we remain focused on sustainable operations, community engagement, and creating opportunities in the local area." That statement commits to no specific targets. No power procurement details, construction timeline, or capacity delivery dates were disclosed.

Takayo Takamuro, executive officer, European chief executive and board director at Telehouse, said: "This acquisition supports the next phase of our growth and our commitment to supporting customers' AI ambitions. The new data center will be one of the largest facilities in the Telehouse London Docklands campus, reinforcing its role as the leading connectivity hub in Europe."

How did the deal come together?

News of the purchase first surfaced in March. Telehouse declined to comment at the time. The completed sale confirms those earlier reports.

Chris Lewis, head of UK transactions at LaSalle Investment Management, said the refurbishment works undertaken with Trilogy "paved the way" for the development. He said the Docklands are "set to host an important AI-ready data center, critical to powering London's tech sector."

The sellers have history with the asset. LaSalle, a JLL subsidiary managing $86.8 billion in real estate equity and debt, and Trilogy, a developer specializing in underperforming assets, bought the campus from Criterion Capital in 2015 for £170 million ($227m). They converted it to educational use. The firms put it on the market last October, reportedly seeking £247.5m ($330.6m). The final price of £220m sits roughly £27.5m below that asking figure.

The land was once part of the old East India Company docks and became an office campus in the early 1990s.

What does this mean for the Docklands campus?

Telehouse opened its London North facility in the 1990s, the first purpose-built carrier-neutral data center (a facility open to multiple network operators) in Europe. The campus now totals six buildings. Telehouse West Two, a nine-story facility that broke ground in October, is due for completion in 2028.

The 65MW project would rank among the largest facilities on the campus. Telehouse has not stated when construction will begin or when the capacity will come online.

Founded in 1998, Telehouse operates data centers in London, Frankfurt, Istanbul, Paris, Marseille, Hong Kong, Beijing, Shanghai, Singapore, Tokyo, Bangkok, Los Angeles, New York, and Toronto.