New Zealand-based infrastructure business Infratil has teamed up with Kao Data, the data centre business of UK fund Legal & General, to back a £120M boost to advanced data centres for high-performance colocation.

Kao's joint owners, Legal & General Group and Goldacre, will each retain a 30% stake in Kao with Infratil taking 40%. The partners will build a £500M multi-site data centre platform, Data Center Dynamics reported.

Kao Data owns the UK’s largest data centre campus on a 15-acre site at Harlow, the site of Sir Charles Kao’s pioneering discovery of the fibre optic cable in 1966.

Construction of its second 40K SF building will begin later this financial year. The total floorspace will be 150K SF.

Kao Data has already begun to expand. Earlier this year it signed an agreement to acquire two UK prime location data centres with a long-term anchor lease from a large financial services business. This purchase will enable Kao Data to deliver multi-site services for its clients and expand potential capacity to around 55 megawatts, while delivering long-term trusted operations for clients' mission-critical infrastructure.

The Harlow campus is within the UK’s London to Cambridge Innovation Corridor.

The investment comes as the dash into the European data centre sector gathers pace, inspired by sky-high growth rates and rock-bottom vacancies.

The hope is that the less mature European scene will match performance in the U.S.

CBRE puts U.S. data centre vacancy at just 1.6% whilst Knight Frank and DC Byte calculate that investment deals in the sector, including corporate M&A transactions, totalled £25B ($34B) in 2020.

In June Blackstone struck a deal to buy listed data centre company QTS for $10B, a price 20% higher than the level at which its shares traded before the deal was announced, and the largest-ever deal for a data centre company.