John Lewis reveals full scale of push into housing
JOHN Lewis bosses are looking at all its 365 department stores and Waitrose supermarkets as possible sites to build new homes.
The company shocked the City when it announced plans to move into private property development in a bid to diversify away from retail.
The John Lewis Partnership (JLP) has set a target of 10,000 new homes over the next ten years.
Half of them will be on sites in its existing portfolio, meaning stores and supermarkets will be converted into residential property.
This week Nina Bhatia, director of commercial development, confirmed the firm’s whole estate was being considered for development.
The plans have led to speculation whether John Lewis will convert existing shop space, build on top of supermarkets or even put buildings up alongside the existing store.
The company has already identified 20 initial sites for the ‘build-torent’ projects, and is expected to present its first two planning applications in early 2022 – a year later than planned.
John Lewis has some of the most recognisable sites in British retail, including a large department store in London’s Sloane Square and its flagship site on Oxford Street, as well as long established shops in Nottingham and Edinburgh.
But the retailer has been struggling to fight back from years of declining profits and the impact of the pandemic. During the pandemic it shut a third of its department stores and reorganised its head office, together resulting in the loss of thousands of jobs.
JLP chairman Dame Sharon White (pictured right), however, has staked her leadership on plans to diversify the brand away from retail into a wider range of financial service, furniture rental, horticulture and private housing.
The 54-year-old hopes that 40pc of profits will come from nonretail by 2030, and said that ‘as we repurpose and potentially reduce our shop estate, we want to put excess space to good social use’ – by offering affordable housing to tackle the housing crisis.
The flats will be kitted out with John Lewis furniture, and bosses hope residents will become Waitrose customers, or purchase products such as home insurance.
An insider said: ‘Our focus is likely to be more Waitrose sites at the moment. I would imagine we might be able to bring forward our plans early next year.’
The developments will range from studio flats to houses. John Lewis is expected to sign up with a partner to build the 5,000 on entirely new sites. Andrew Busby, of analysts Retail Reflections, said: ‘It’s clear Sharon and her team have come to the conclusion, rightly or wrongly, that they are going to get all the revenue they need from retail.
‘This is an indicator of intention and all bets are off. They’re prepared to look at pretty much anything – everything is up for grabs.’
In the six months to the end of July, John Lewis reported a loss of £29m, after spending millions of pounds on redundancies and shop closures. This compared to the mammoth £635m loss in the same period in 2020, when it wrote off £500m from the value of its stores. It expects between 60pc and 70pc of John Lewis’s sales to be online, compared to 40pc last year. Waitrose said a fifth of its sales will come from online customers, compared to 5pc before the pandemic.