Segro boss David Sleath: AI data centre roll out a matter of life and death
The roll out of AI data centres in the UK’s urban hubs is a matter of life and death, warehouse magnate David Sleath has said.
In an interview with CityAM, the chief executive of industrial property group Segro said developing data centres in urban areas is “critical” for relying on developments such as saving lives through AI-guided surgery.
Data centre planning applications hit an all-time high in the UK last year and have been a core driver for Segro, whose portfolio includes Slough Trading Estate which boasts the biggest data centre cluster in Europe.
Having started up as Slough Estates Group, Segro has developed warehouses for Netflix and Amazon and once owned the property used in British television show The Office.
While the datacentres which train large-language models can be placed in remote areas, the hubs which allow users to interact with AI need to be close to users in their cities and regions, Sleath said.
He told CityAM: “If you’re running a financial trading desk, you can’t afford to have a delay while your data goes several hundred miles away and comes back again. So you need milliseconds of response.
“If you’re a surgeon and you’re using AI to guide your incisions, you need low latency. So there’s a big demand for data centers around user interface, as opposed to the remote training, that needs to be close at hand.”
The construction of data centres in urban areas has often faced pushback from residents and councils, including a dispute in Hackney over the redevelopment of a former brewery.
Sleath described the roll out of data centres in cities as a “delicate political choice,” saying concerns over energy and water use are “fair and reasonable questions for society and the communities to ask”.
‘Almost inconceivable’ AI demand will be met
Segro upped its dividend on Friday after reporting a jump in profit, up 8.3 per cent to £509m, which it said was driven by a pickup in demand and occupancy levels.
Shares in the group, which is listed on the FTSE 100, nudged up by two per cent after its financial results on Friday.
Sleath said the difficulty of finding space for large warehouses and industrial complexes in densely-developed cities like London and Paris leaves him confident that demand will stay high.
He said: “We’re absolutely convinced that, because of the way society is changing, there’s a need for more of this space at close hand.
“It’s almost inconceivable to me that there will be enough supply of sites to meet that demand.”