UK government secures £10bn AI datacentre investment from US firm

The UK town of Blyth in Northumberland is set to become home to Europe’s biggest datacentre devoted to housing artificial intelligence (AI) workloads.

The £10bn project is being funded by US investment firm Blackstone and facilitated by the UK government’s Office for Investment, and is forecast to create more than 4,000 jobs in the region.

The site’s construction is due to start in 2025, with the facility expected to be used to store the data and systems needed to power AI systems.

Prime minister Keir Starmer broke the news of the project during an appearance in New York today, where he is on visit to promote the UK as a good place for overseas investors to fund projects.

“The number one mission of my government is to grow our economy, so that hard-working British people reap the benefits – and more foreign investment is a crucial part of that plan,” he said.

“New investment such as the one we’ve announced with Blackstone today is a huge vote of confidence in the UK, and it proves that Britain is back as a major player on the global stage and we’re open for business.”

It has also been confirmed that £110m of the project’s funding will be used by Blackstone to ensure Blyth has access to the transport infrastructure and skills training needed so that the local community is positioned to reap the economic benefits of the project.

Jon Gray, president and chief operating officer of Blackstone, said the UK is a “top investment market” for the firm.

“We are making significant commitments to building social housing, facilitating the energy transition, growing life sciences companies and developing critical infrastructure needed to fuel the digital economy,” he said.

“This includes a projected £10bn investment to build one of Europe’s largest hyperscale datacentres supporting 4,000 jobs. Blackstone is committed to Britain.”

News of the investment follows a busy couple of months for the new government where championing the UK datacentre market is concerned. Having vowed in its pre-election manifesto to loosen the planning rules for datacentres to accelerate the pace of new developments across the UK, since coming to power in early July, a consultation on how best to do this has been launched.

It has also placed under review several datacentre builds the previous government denied planning permission for, and backed plans for a £3.75bn project in Hertfordshire to build a hyperscale datacentre next to South Mimms service station.

Earlier this month, the government also announced that datacentres would be reclassified as Critical National Infrastructure in acknowledgement of the important work they do to keep the UK’s digital economy ticking over.