A day in Milan, the city that is reemerging from Lockdown


Three days after Boris Johnson announced new restrictions for the UK, following a recent increase of Covid-19 cases, we are all wondering what our lives will look like in the upcoming winter season. Will we be able to go back to our office in October as planned, or must we, given the advice to workers who CAN work from home to keep doing so, stay glued to Zoom for the foreseeable future?

Before lockdown, we used to meet the majority of our clients face to face, feeling that it was the most effective way to build up a rapport, make decisions and implement plans. However, since March we have adapted to a completely different reality,choosing virtual meetings and avoiding the office or public spaces. Even after society started to open up, security has remained a priority.  But finally, after several months of working from home, last Wednesday I was able to travel to Milan and carry out some meetings in person.

Visiting a city that I know very well, it is clear to me that Italyis starting to return to normal and that the Italian retail sector is trying to resume its usual activity and opulence. However, it hasn’t been an easy ride and not everyone has come through unscathed. Covid-19 froze one of the biggest real estate and commercial projects in Italy: Westfield Milan shopping centre, a mega project by Unibail-Rodamco-Westfield, now postponed to an undisclosed date. It would be such a shame if we didn’t get to see this 1.6 billion euro project materialising in Segrate, on the outskirts of Milan.

Other projects seem to be going ahead. A couple of months before lockdown, Hines had just signed contracts to acquire the iconic 27-story mixed-use Torre Velasca tower in the centre of Milan, on behalf of the Hines European Value Fund. Built after the war and located near Duomo di Milano cathedral, the medieval-influenced Torre Velasca comprises over 20,000 square metres of office, multifamily and retail space and is set to be transformed into a high-quality office-led, mixed-use scheme, with the intent of leveraging the global firms wider placemaking experience to enhance and fully reposition the surrounding piazza.

As I arrived at my first meeting, Francesca from Rustioni & Partners was waiting for me and took me through to the firstmeeting room I had seen in six months: matching faces tonames felt very refreshing. First, we had a catch up with the on-site team about the Italian market and the way Milan and Italy are recovering from lockdown and the devastatingclosure of all businesses. There is a lot to talk about. The turnover of the Italian real estate market will not reach 110 billion euros in 2020, according to an article by Sole 24 Ore and Scenari Immobiliari, down 15.2% compared to 2019. Theresidential sector is losing 10%, the hotel sector is falling by 70% and the tertiary sector by almost 30%.

However, Milan is the main “magnet”. Most of the investments (57%) came to Milan while only 9% of the total went to Rome, according to Bnp Paribas. At the moment, returns on high-end investments seem to be holding at around 3.30% for the office sector in Milan and 4% in Rome. High street returns in Milan are at 3.25%, while the city shows great stable values also for logistics, with average returns at 5.25%.

Next up, another meeting, this time in Corso Buenos Aires. Stretching over 1.4 kilometres it’s the longest shopping street in Italy, if not Europe. Another opportunity to see clients I have only met on screen before, building up an emotional  rapport impossible to achieve over Zoom.

Moving around in the city, I could not help noticing how Milan has adapted to new needs and innovations.  Announced in April 2020, Il Piano Strade Aperte (The Open Streets Plan) included low-cost temporary cycle lanes, new and widened pavements, 30kph (20mph) speed limits, and pedestrian and cyclist priority streets. It was heartening to see that bikes now have their own lane, although scooters, segways and hoverboards are also using it. Just like other big European cities, Milan has struggled with keeping its cyclists safe in ever increasing traffic .There was definitely a need to come up with a solution for them. However, speaking to the locals, I hear that giving more space to cyclists has pushed car and motorbike parking spaces between the track and the lane, causing much concern from the entire population and making many question the safety of the scheme.

I left Milan with a positive feeling – the city was filled with optimism despite everything it has suffered and the uncertainty of the months to come. Italy seems to be rising, ready to reclaim its place on the international scene – and even though things are unlikely to return to “normal” in the blink of an eye, it was amazing to finally be able to meet clients and contacts face to face.

With this in mind, offices and shops worldwide must be ready to meet new consumer and occupiersneeds, focusing on safe usage and new digital technologies to enable this. Emerging trends before Covid-19 such as agile working and the use of advanced technology have now been accelerated at a staggering speed and we would all do well to accept and adapt to this new era of transformation.

 

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The office reimagined: Reflections from Paris Real Estate Week


To have or not to have offices?

That was the (most burning) question of Paris Real Estate Week, which the Innesco team had the pleasure of joining. Perhaps to no one’s surprise, the overarching topic of the conference was Covid-19 and the effects the pandemic will have on cities and real estate. Taking place this week in lieu of MIPIM, the event was held over three days; as a physical event in Paris, and streamed online. Below are our key takeaways.

 

If the majority of people will regularly work from home at least two days a week going forward (compared to none pre-Covid), this will bring with it a series of implications. In the session ‘What makes a city great?’, the panel discussed how cities will evolve as a result of changing working habits. One panellist noted that the change may lead to more investment in mixed use, as people will want to live and work closer together. It might also lead to a rise in flexible office space, as companies abandon big, collective offices in favour of several hubs in the same city, allowing workers to choose an office space closer to their homes – which, in turn, will change the layout of cities, as residential and office clusters blend together.

 

Research is showing that the majority of people today believe that some form of working from home will from now on be considered a natural part of company policy. But while there is no doubt that we are dealing with  a complete overhaul of workspace, most agree that the office will still have a role to play – we might be working from home two days a week, but that leaves three days working away from our homes. We therefore need to set expectations for what people could require from the office: What services do they want? What layout and which spaces can support the ways in which they will need to work? One panellist noted that people will need more collaborative space because “they can sit by themselves and work from home, so the office needs to fill another function”. Offices therefore need to be more agile and offer space that can be evolved and adapted to the type of work which is  to be carried out there – for example by creating comfortable spaces to meet or to think, and creative spaces where people can walk around instead of sitting down. Another panellist added that “we have experienced what we can do from home, so offices will need to show us that it is worth a two-hour drive to get to it”. This may well mean creating facilities that promote learning and collaborating, thereby increasing creativity.

 

Similarly, the session ‘Reimagining the workplace: the future of work after pandemic’ highlighted that working remotely creates a risk for missing out on important aspects such as collaboration, innovation, brainstorming, career mobility and interacting with people outside your direct colleague group. Harvard Business Review has shown that people worked 40 percent more with close colleagues over lockdown, via for example frequent Zoom meetings, but collaborated or worked 10 percent less with other people in the company. It is clear that we need to assess what the implication of this loss of connection will mean long-term.

 

On a panel called ‘Addressing tomorrow’s challenges’, one speaker hypothesised that office buildings will become more strategic; less about housing employees on a day-to-day basis, and more about expressing the company brand, a place in which to embody corporate culture, reinforce team efficiency, improve creativity and serendipity, as well as attract talent. With Covid-19 accelerating trends such as flexibility, digitalisation, wellbeing and “the era of services”, there will be a decrease of office volume; therefore, office developers will need to improve in order to compete, which will mean having a combination of the best location, the best building space and the best services.

 

Consensus seems to be that there is a need to revolutionise office space following Covid-19. This draws similarities to the way retail has evolved in response to e-commerce; just as retail has had to reinvent itself to offer something that online simply can’t, offices will need to evolve into offering something that our kitchen tables won’t. As with retail, experience may well be the key word here. Summing up the conference, one panellist on the session ‘Investment & creative placemaking’ noted that “thirty years ago, people looked at real estate as a commodity, a physical asset class where everybody spoke about price per square metre. In the last 20 years, real estate has become a financial asset class where it was all about cash flow, cash flow, cash flow. Today, it is changing – yes cashflow still matters, but also what real estate is bringing to our lives.”

 

However, not everyone agrees. In his much-anticipated keynote in Paris, former French President Nicolas Sarkozy said: “because life is more important than circumstances, life after Covid-19 will look very much the same as before. Every time there is a crisis, we say that life will never be the same again, but every time the crisis ends, everything is exactly the same”.

 

Mr Sarkozy’s beliefs aside, OUR gut feeling is that once Covid-19 is over, life will look very, very different – not least when it comes to the ways in which we work.

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Retail isn’t dying – it’s changing: Primark results show growing shift away from city-centres


Primark carved out an interesting piece of the property news cycle this week, stating on Monday that its adjusted operating profit is now expected to be at least at the top end of the previously advised £300-350m range. Its sales surge since reopening its stores has been impressive, raising the question of how a retail business, which was forced to shutter its entire store estate during the height of lockdown, without an online trading platform to fall back on, has managed to significantly outperform predictions. BBC’s Wake up To Money on Tuesday went some way to answering this with an interesting discussion focussed on Primark’s unique value-for-money proposition, homeware offering and low-cost word-of-mouth marketing.

Significant to the current property sector mosaic is that, while Primark’s overall sales figures look relatively promising, they show that performance at its new supersize store in Birmingham, its two flagships on Oxford Street and one in Manchester, has been lagging. Primark said full-year sales in the UK since reopening are expected to be 12 per cent lower on a like-for-like basis. Take these four large UK stores out of the equation, and this figure drops to only 5 per cent, shedding light on a wider story about the shift away from city centre destinations as a result of Covid-19.

Primark reported that sales at its stores in edge-of-town retail parks are higher than last year. In fact, retail parks have become the clear winner among retail destinations in ‘Covid World’ since lockdown restrictions were lifted. According to the British Retail Consortium-Shoppertrak footfall monitor, high streets struggled the most in August, with footfall down 42%, while in shopping centres, traffic declined 37%. In retail parks, however, footfall decline was tempered at 11%. (BRC, quoted in Morning Star). We are now operating in a retail industry where driving footfall is equally, if not more important than driving average transaction value increase. As Covid-19 continues to disrupt normalcy nationwide, there appears to be two key elements at play that are shaping retail performance across the board; a lack of office workers as more and more people work from home, and a nervousness about getting on public transport to shop in city centres.

Retail Parks, unlike city-centre stores, generally offer much larger, more spacious formats and, being out of town, present the ability for shoppers to safely use their own transport. Exemplifying the investment appetite for retail parks, this week we also saw European property investor, M7 Real Estate acquire a portfolio of six UK retail parks for £157 million with CEO Richard Croft stating that retail parks have the additional benefit of being divided in half between warehousing and physical stores, offering a click and collect element.

As Croft aptly put it “I don’t think retail is dying. Retail is changing”, and retail parks, as well as local shopping centres and accessible high street stores, look to be at the forefront of that change.

Andrew Smith, Account Manager, Innesco

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The experiential retail era.


In a post Covid world, consumer behaviour is changing. If you hadn’t noticed, we’re living in the world of digital personalisation. Brands such as Netflix, Amazon and Spotify are changing customer behaviour using their personalisation recommendation engines.
“Personalisation is changing how retailers reach, interact with, and utilise data from customers. The result is smarter marketing campaigns that are uniquely catered to each customer’s interests, and modern shoppers won’t settle for less,” says Jasmine Glasheen from retail futures consultancy Insider Trends.
Personalisation is closely associated with online retail, with algorithms and online data, particularly in a time where people are hesitant to shop in store. However, although consumer behaviour is changing and more transactions are taking place online, this doesn’t mean that it’s all over for physical shops.
“The unique part to retail spaces is that they are physical. This was true before Covid and remains true as we begin our next chapter in life post lockdown, ” said Freddie Sheridan, Global Director at global design agency Sheridan&Co earlier this summer.
If physical shops will remain a vital part of the shopping experience – how can the personalisation process be leveraged there?  What does personalisation mean in the non-digital context?
A memorable example from physical stores was the Share a Coke campaign from 2013-2014. Coca Cola replaced the iconic logo with some of the most popular names (adapted for geographical demographics), which were then printed on Coca-Cola labels. People were also able to personalise their own bottles of Coca-Cola on the Share a Coke tour.
Iconic denim brand Levi’s is another global brand that stand out when it comes to personalisation by customising their denim products both in-store and online. Jennifer Sey, CMO Levi Strauss & Co Global Brands, said last year that their customers had been personalising their jeans for ages and the company wanted to make it easier for them..
“They sat in bathtubs to shrink them to fit, they patched and repaired them, they sanded them down for the perfect worn in finish. Now, with Future Finish, we’re making it easy to create a one of a kind custom pair of Levi’s,” she said at the launch of the initiative.
Despite the current hesitance to return to physical stores, it is unlikely that customers will shun the high street for ever. With our music, our films and our purchases curated and recommended for us online, is it any wonder that we are starting to look for the same experience in store?  Customer behaviour is changing and the winners will be those who stay on top of what their customer wants. With the online experience tailored to the individual customer, it could look even bleaker for the high street if personalisation is neglected in physical stores​. It will be important to stand out, but the question is how to achieve this with a limited marketing budget.
According to Piyush Chowhan, Global Chief Information Officer at LuLuGroup speaking on the RetailME podcast;
“People are talking about online a lot … it’s not about physical or online and trying to marry these two together into an offering…This is an experiential retail era rather than a transactional retail era…we want to give that best experience to the customer.”

Which, I’m sure you’ll agree, should always be the ultimate goal.
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EAT OUT TO HELP OUT: Government steps aside, Grosvenor steps in


One of the most interesting moves last week was the decision by Grosvenor to extend the ‘Eat Out To Help Out’ scheme for tenants across its Mayfair and Belgravia holdings. Take-up of the Government’s scheme has been hugely successful – figures this week revealed some 64 million meals had been claimed – but is set to come to an end on Monday. But for those restaurants that occupy Grosvenor properties, the years of premium rents are about to pay off, with the landed estate picking up the bill for its own Eat Out To Help Out programme in September.

Those restaurants within the estate will welcome the news, as will the patrons that visit the establishments – although there is a question mark over whether £10 off of lunch is enough to entice the well-heeled residents of W1 and SW1. Likelier, perhaps, is a diversion of customers from nearby areas such as Soho, Fitzrovia and Pimlico while the scheme is in operation.

For Grosvenor, this is a particularly smart move – helping occupiers weather the bad times will likely translate into lower void rates further down the line – but one that as a landed estate it is particularly well-placed to enact. With low levels of debt and a host of office and residential occupiers continuing to pay the bills, a little support for the restaurants on its patch will go a long way.

But while the two Eat Out To Help Out Schemes look the same, they are actually trying to achieve different things. Grosvenor’s aim is to get more cash into restaurant tills, knowing that this makes it all the more likely that its rent collection will hold up better as a result though. For the Government, however, the extra income for restaurants is a mere side-effect; if it simply wanted restaurants to have more cash, a bailout similar to that seen for the arts would be much easier to administer. What Sunak really wants us to do is get used to the idea of eating out again.

A legacy problem of the Government’s messaging is that it was almost too effective; ministers were surprised at the level of observance of the lockdown, and now that things are opening up the same caution remains. A true economic recovery cannot happen until people become comfortable again eating out. It is a tightrope to walk, but if the scheme can help us ‘unlearn’ some of the behaviours that served us so well when the outbreak was at its height, it will have done its job.

Most people that have taken advantage of the scheme have been surprised at how comfortable they have been with the protocols, and felt safer than they expected to. If caution is the main thing holding people back from returning to restaurants and pubs, Eat Out To Help Out has broken the taboo. And if you’ve visited a restaurant, it’s not as big a leap to take a train and go back to the office. Our city centres need people in them; let us hope Rishi’s Discount will encourage more of us to do just that.

Andrew Jefford, Account Director, Innesco

More like this: 

The importance of digital marketing in ‘Covid World’

Creating a better future for real estate

Read our whole news round up for week 35 in our latest edition of Paperclip.

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EAT OUT TO HELP OUT: GOVERNMENT STEPS ASIDE, GROSVENOR STEPS IN


One of the most interesting moves this week was the decision by Grosvenor to extend the ‘Eat Out To Help Out’ scheme for tenants across its Mayfair and Belgravia holdings. Take-up of the Government’s scheme has been hugely successful – figures this week revealed some 64 million meals had been claimed – but is set to come to an end on Monday. But for those restaurants that occupy Grosvenor properties, the years of premium rents are about to pay off, with the landed estate picking up the bill for its own Eat Out To Help Out programme in September.

 

Those restaurants within the estate will welcome the news, as will the patrons that visit the establishments – although there is a question mark over whether £10 off of lunch is enough to entice the well-heeled residents of W1 and SW1. Likelier, perhaps, is a diversion of customers from nearby areas such as Soho, Fitzrovia and Pimlico while the scheme is in operation.

 

For Grosvenor, this is a particularly smart move – helping occupiers weather the bad times will likely translate into lower void rates further down the line – but one that as a landed estate it is particularly well-placed to enact. With low levels of debt and a host of office and residential occupiers continuing to pay the bills, a little support for the restaurants on its patch will go a long way.

 

But while the two Eat Out To Help Out Schemes look the same, they are actually trying to achieve different things. Grosvenor’s aim is to get more cash into restaurant tills, knowing that this makes it all the more likely that its rent collection will hold up better as a result though. For the Government, however, the extra income for restaurants is a mere side-effect; if it simply wanted restaurants to have more cash, a bailout similar to that seen for the arts would be much easier to administer. What Sunak really wants us to do is get used to the idea of eating out again.

 

A legacy problem of the Government’s messaging is that it was almost too effective; ministers were surprised at the level of observance of the lockdown, and now that things are opening up the same caution remains. A true economic recovery cannot happen until people become comfortable again eating out. It is a tightrope to walk, but if the scheme can help us ‘unlearn’ some of the behaviours that served us so well when the outbreak was at its height, it will have done its job.

 

Most people that have taken advantage of the scheme have been surprised at how comfortable they have been with the protocols, and felt safer than they expected to. If caution is the main thing holding people back from returning to restaurants and pubs, Eat Out To Help Out has broken the taboo. And if you’ve visited a restaurant, it’s not as big a leap to take a train and go back to the office. Our city centres need people in them; let us hope Rishi’s Discount will encourage more of us to do just that.

 

 

 

 

 

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It’s #Week34 – and “Time waits for no man”


Hello everyone! – It’s #Week34 and many of you are still busy enjoying the last few days of your holiday. Maybe these have been spent in the back garden, on a staycation, or perhaps you’ve run the gauntlet on which countries would stay safe to return from with no quarantine? It’s been especially difficult with France, Croatia, the Netherlands and Monaco recently being added to Spain, Luxembourg, Belgium, Andorra and the Bahamas, all of which lost their travel corridors with the UK in the last few weeks. I’ve actually managed two work trips in the last month – to Paris (before quarantine rules were imposed)- and earlier this week I went to #Athens (Greece still holding on to its safe travel corridor). Despite everything, it is certainly possible to work safely within the regulations.

What once were quiet summer months have this year proved unusually active (for us as well) with many property companies recognising that “time waits for no man” and that teams would only be delaying the inevitable if they were to leave it to the traditional September “back to school” time. This is especially true of international businesses, with offices across different countries and continents, stepping up to trigger some action and activity – to be “battle-ready” for the post-Covid markets, or at least to mitigate the impacts. These past few weeks companies have been working flat out to keep their heads above water, reviewing asset management and marketing plans and putting their fingers on where changes and adjustments are needed.

The US often leads the way, and the repurposing of department stores stepped up again this week with the suggestion that @SimonPropertyGp could convert its @jcpenney stores into @amazon distribution stores. #Repurposing is something I think we are all getting used to now – after all, @blackrock entered that market some five years ago.@Apple hasn’t been letting the grass grow under its feet during the pandemic with its $2 trillion USD valuation either, a figure that can be conveniently compared to the UK government debt, which exceeded £2 trillion GBP ($2.6 trillion USD) for the first time this week.

Added to all this activity is the development and adoption of new and varied ‘back to the office’ plans – the ‘Threedom of Work’ from @HUGOBOSS, or the 50/50 or 3:2 rules, where teams are separated through different days in the office. Whatever model we choose, it is clear that this autumn will continue to show great changes in the way we work. What will it look like for you? Have a great weekend, Dan Innes. Founder, Innesco

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Creating a better future for real estate


Amidst the major investments, acquisitions and new developments that occupy the real estate news cycle, the global perspective on our industry has traditionally been contained within the corporate world, defined by rental income, profit margins, share prices, dividends and so on.

However, even before Covid-19 forced us to rethink our role as both individuals and businesses in wider society, the notions of social impact and social value were gradually becoming a core part of real estate business’ objectives; a transition in collective mindset which, like many things, has been accelerated by Covid and will no doubt continue to grow in significance long after the virus is defeated (See Revo’s new Social Value Framework).

To provide a recent example, Covid-19 prompted a radical and instant nationwide response from real estate businesses to the extreme cases of homelessness in England. Rough sleepers and those staying in communal shelters were promptly moved into safe places days later which prevented them from contracting the virus and certainly saved lives.

Further, this week, Property Week brought to our attention the crowdfunding platform that Beam has launched in partnership with London landlords, helping homeless people crowd fund for rent deposits.

While we often see headlines that present landlords as tight fisted and unsympathetic, amazing initiatives such as these remind us that most people are inherently good and we should do our best to treat each other with respect and understanding. The pandemic has affected us all – and in real estate, we need to grasp this opportunity of shared experience to create an even stronger community with a more powerful drive to do good.

CBRE statistics state that: “The government has pledged to halve rough sleeping by 2022 and eliminate it by 2027. The Rough Sleeping Strategy and the recent Homelessness Reduction Act 2017 are welcome steps in the right direction.”

The fact that the immediate action to rehome rough sleepers in the time that the government did proves that it was always possible, and simply needed the current circumstances to catalyse action. This then leaves one to question what will happen once everything is back to ‘normal’. Will the real estate sector stand by and allow the homeless or rough sleepers to fend for themselves once again, or is it finally time to realise that more can and should be done to create a better future of the less fortunate?

You might say Covid has pressed the reset button on the way we do business, which doesn’t come around too often in a lifetime. Creating a ‘better future’ should be a primary concern for any and all  businesses as we navigate these uncertain times and, as a fundamentally human sector, real estate is well-placed to take the lead.

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The importance of digital marketing in ‘Covid World’


In times of crisis companies are known to cut activities that are considered “unnecessary”. Digital marketing often falls within this category – and yet we live in a world where the web is arguably the most valuable channel for reaching customers with your key messages.

As fairs, conferences, workshops and the like have been postponed or cancelled due to Covid-19, and even as face to face meetings are becoming positively utopian, we are now left with our digital network of contacts and an unprecedented opportunity to make it work limitlessly. Virtual means represent our main road to communicate with our target audience, who is likely to be more receptive because of new working conditions; staying at home, on their computer or with a smartphone in hand. Digital marketing will be key to getting out of Covid-19, with all its limitations, even stronger than before.

Trying to recover from the shock of seeing thousands of euros invested every year on exhibition space sliding away, companies and entrepreneurs need to seriously think about a digital transformation, not only in regards to human resources but also for all the other activities of the company, including advertising and promotion.

Virtual networks, in this sense, offer many great alternatives. There is of course social media, from those most suitable for B2B, such as LinkedIn, Instagram or Facebook, ideal for addressing the final consumer, or Twitter, to speak to the wider industry and other thought leaders. Given that there is a solution for every need, all that remains is to intercept the needs of the target, decide the objectives, create the strategy and put this into practice in a professional, consistent and effective way.

We know that even when the worst is over, the return to our “normal” life will be quite gradual and not that easy: how long will it really take to feel totally comfortable in shaking a potential client’s hands, without them first thinking of sanitising themselves with a potent gel before buying your product or service? Online channels have the advantage of promoting social distancing but, at the same time, allowing you to be visible out there and sell to the best of your ability.

Now is the time to wise up and realise that digital communications strategies are the key to business growth in the current climate. You could start by working on existing channels, such as social pages or the company blog, by inserting new content designed to intercept customers or reassure those already existing during this difficult period. Believe it; your online presence will be recognised and appreciated by your stakeholders.

Further, many events companies have adapted their formats to fit the virtual realm, inviting members to participate remotely and, at the same time, try something new! The number of rescheduled online events is increasing – among them the RLI and EG Awards in the real estate sector which will be hosted virtually for the first time this year.

The opportunities for virtual engagement are ripe for the taking. Remember, this is nothing new, but rather another trend that has been accelerated by Covid-19 and will continue to grow in significance long after the pandemic is over. With this in mind, use this opportunity to transform and grow the digital arm of your business. Invest in new tools and digital marketing training and expertise, lead your competitors in your digital capabilities, and set yourself on virtual path to success.

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John Lewis may turn surplus stores into affordable homes


In a letter sent out to its 80,000 employees on Thursday, The John Lewis Partnership gave an update on the wide strategic review it is currently undertaking to future-proof its business. The letter announced a set of initiatives currently being considered – some less surprising (the closing down of stores where demand is declining and going “Digital First”) than others (creating new channels for renting out products and the re-selling of second hand goods and building a horticulture – yes, gardening – venture). Perhaps the most compelling of them all was the announcement of plans to convert vacant retail space into affordable, mixed-use housing.

Commenting on this rather noble move, the partnership’s chair Dame Sharon White commented: “As we repurpose and potentially reduce our shop estate, we want to put excess space to good social use”, and further added that the company needs to expand beyond retail in order to stay “sustainable over the long term”.

As the manifesto discusses “tackling inequality, wellbeing and sustainable living”, stating that these themes have never been more relevant than now, given the “economic uncertainty and social inequality” the Covid-19 pandemic has brought on, the initiatives would surely be a good way of giving back to its communities. At the same time, retail analysts seem confused at some of the more ‘out there’ initiatives – some even going so far as calling them “bonkers” and questioning whether the partnership doesn’t “have enough problems”. Others worry that the plans would “add complexity” to the business, which has previously vowed to simplify.

Independent retail analyst Richard Hyman said to The Telegraph: “In order to have the permission to have a green, sustainable agenda, in line with the traditional John Lewis values, you have to be able to drive revenues. That gives you the permission to develop those values. If your business faces an existential threat you need some commercial solutions first and foremost.”

Of course, John Lewis is not alone in venturing into new territories: the news come but a few weeks after the details of Unibail-Rodamco-Westfield’s strategic repositioning plans were made public. These included proposals to convert its House of Fraser department store at Westfield London into offices – plans which were approved by the local council’s planning committee just last week. IKEA Group also recently announced residential plans, namely developing a 700-home residential scheme next to its Tottenham store in London. At a time when retail profit margins are under more pressure than ever – not least as Covid-19 has meant “the most challenging period for high streets and shops in our history”, in the words of UK Prime Minister Boris Johnson – we are likely to see an increasing amount of diversification and agility in the retail sector.

In a recent article in Forbes, one commentator argued that Covid-19 has created a “new ecosystem [implying] a redesign, often radical, of many of our activities” – affecting “cities, restaurants, public spaces, travel, prisons, supply chains, health care, trade, education, work and communication”. So, as we await further details of John Lewis’ plans later this autumn, perhaps we need to get used to the idea of moving into a department store. Stranger things have happened after all.

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