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.Go back to category