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What can a retailer do to compensate for dwindling retail revenue? John Lewis, owner of British department store chain Waitrose, is considering to build up to 10,000 homes. The rent should help to keep the group revenue on par.
Expensive housing market
According to The Guardian, the group has found sufficient free space on its current locations to build “at least” 7,000 homes. The properties include floors above supermarkets and grounds adjacent to distributions centres. The homes would vary from small city apartments to full-size four-bedroom homes.
The first batch of homes is intended for the southeast of England, but John Lewis sees potential throughout the entire country. Retail prices in the United Kingdom are soaring, and young adults are finding it increasingly hard to acquire a property of their own. Employees of John Lewis, who are all partners in the business, are eligible for a rental discount.
New source of income
This is not the first time that John Lewis has dipped into the housing market: the company already owns a number of homes in Leckford, a small town in Hampshire near England’s southern coast. The retailer intends to apply for the first building permits early next year.
By investing in real estate, John Lewis hopes to tap into a new source of income. The company has suffered from the rapid rise of online competitors in recent years. The corona pandemic only added to that, leaving the group with a net loss in 2020. The consumers’ shift to online has forced John Lewis to close sixteen of its fifty stores, but the company has now allocated 800 million pounds (just shy of a billion euros) to revamp the remaining branches and to improve its website and mobile apps.
