Harworth Group Shares (HWG) Rise as Firm Completes £52.9M Land Sale

Harworth Group shares (LON: HWG) are up 1.28% today, as the company completes a sale to a Microsoft UK subsidiary. This move comes after a 16% decline in share price over recent months, from 52 week highs of 195p set back in September.

The prominent UK-based property regeneration company, has successfully completed the sale of a 27-acre land parcel at Skelton Grange in Leeds to MSFT MCIO Limited, a Microsoft subsidiary, for £52.9 million. This transaction marks the first phase of a larger 48-acre development deal, with further plans in place for continued site sales and development.

In the initial phase of this strategic partnership, Harworth received £0.5 million in reimbursement for securing additional power capacity for the site, highlighting the infrastructure enhancements made in anticipation of future development. The total planned investment by Harworth is approximately £48.7 million, with projected sales expected to reach £135.7 million, boasting an impressive internal rate of return (IRR) exceeding 40%.

A second phase is anticipated, with the sale of an additional 21-acre plot, expected to conclude in the first half of 2026 for around £53.2 million. Meanwhile, Harworth intends to retain 16 acres of the land for the development of roughly 250,000 square feet of employment space, serving diverse commercial needs.

The Skelton Grange site is set to host a hyperscale data center, a battery energy storage system, and an energy-from-waste facility, alongside restored natural habitats. This multi-use approach reflects Harworth's commitment to sustainable development and a robust infrastructural framework.

Harworth originally acquired the Skelton Grange land in December 2014 for about £3 million. The substantial appreciation in land value underscores the company's effective redevelopment strategy and alignment with technological advancements.

Lynda Shillaw, CEO of Harworth, emphasized the collaborative efforts with Microsoft and other stakeholders to remediate and service the site, ensuring it meets the necessary conditions for advanced technological and ecological usage. The proceeds from the initial phase sale will be strategically reinvested into Harworth's industrial and logistics pipeline, pursuing high-value opportunities across its portfolio.