The John Lewis Partnership has agreed a £500m multi-decade joint venture with global investment company abrdn to deliver around 1,000 new homes in three locations.
The deal marks a milestone in the company’s plans to use its significant property assets to build residential homes and diversify its business. The joint venture will help the retailer to reach 10 percent of its ambition to build 10,000 new homes over the next decade.
John Lewis says the joint venture brings together abrdn’s experience as one of Europe’s largest residential investment managers together with “the trust, service and quality synonymous with the John Lewis and Waitrose brands.”
The deal will see the Partnership develop and manage the proposed new sites and includes commitments to affordable housing and sustainability tied to its existing 2035 Net Zero pledge.
A statement from the firm says: “We want to create homes that will provide a stable income for the Partnership, and moving into housing aligns with our purpose to make a positive difference for our Partners, customers and communities.”
In Bromley and West Ealing in Greater London, subject to planning permission, Waitrose shops will be redeveloped to provide new homes and improved stores. In Reading, a vacant John Lewis warehouse will be redeveloped. The sites were chosen according to their central location and proximity to transport links.
John Lewis says the Build To Rent residential property market is estimated to double with 30,000 BTR homes completed annually by 2026.
Nina Bhatia, executive director for strategy and commercial development at the John Lewis Partnership, says: “Our partnership with abrdn is a major milestone in our ambition to create much-needed quality residential housing in our communities. Our residents can expect homes furnished by John Lewis with first-rate service and facilities. The move underlines our commitment to build on the strength of our brands to diversify beyond retail into areas where trust really matters.”
And Neil Slater, head of real assets, abrdn, adds: “The critical lack of quality rental accommodation in the UK needs to be addressed, so we are delighted to partner with the John Lewis Partnership to provide the required institutional investment. The ambitions and responsible ethos of our brands both strongly align, and our partnership should offer investors long-term returns and give residents confidence in a top-quality living experience.”
John Lewis says it continues to work with the local authorities and communities to evolve plans and expects to announce more details for West Ealing and Bromley in due course, before aiming to submit its first planning applications next year. A first public consultation for the site in Reading is expected in 2023.