John Lewis is set to enter the residential homes market, after unveiling plans to build 10,000 new rental homes over the next ten years.
According to the Sunday Times, the retail giant has already identified space to build 7,000 new homes across its own property portfolio, including disused department store car parks, above Waitrose supermarkets and next to distribution centres.
In addition, the company is set to develop new sites for the properties, which will range from studio flats to four-bedroom houses. While the first John Lewis homes are set to be built in south east England, the group said there are opportunities across the country to “play its part” in the national housing crisis and have a “strong social purpose” in the future.
Residents will be given the option to rent the properties furnished with the department store’s own products. The properties will also come with a concierge service and may feature a Waitrose convenience store near their entrance.
The John Lewis Partnership’s 80,000 staff could be offered discounted rates on rent, according to the Times. The company is now preparing to lodge a handful of planning applications early next year.
Nina Bhatia, partner and executive director, Strategy and Commercial Development for the John Lewis Partnership, told Retail Sector: “As a business driven by social purpose, we have big ambitions for moving into property rental to address the national housing shortage and support local communities.
“It will also provide a stable, long term income for the Partnership, new employment opportunities for our Partners and plays to our strength as a trusted brand known for strong service.”
Chris Harris, the partnership’s property director, told the Times: “Typically a developer might try and maximise returns and then move onto the next one. We are not trying to do that. We are aiming to charge a fair rent and to stay for the long haul.”
Earlier this year, the group announced it had swung to a pre-tax loss of £517m in the full-year ended 31 January 2021, down from a profit of £146m reported the year before.
This was largely the result of “substantial” exceptional costs of £648m, which included the write down in value of John Lewis shops amid a “pronounced” shift to online, as well as restructuring and redundancy costs from store closures and changes to its head office.
Following its announcement, the group shuttered eight John Lewis stores, placing 1,465 jobs at risk.
The eight shops identified for closure were four ‘At Home’ shops in Ashford, Basingstoke, Chester and Tunbridge Wells and four department stores in Aberdeen, Peterborough, Sheffield and York.