John Lewis wins permission to turn 45% of Oxford Street store into office space
Almost half of John Lewis’s flagship store on London’s Oxford Street could be turned into office space as the company tries to stem its coronavirus losses and return to profit.
The John Lewis Partnership, which runs the department store chain and the Waitrose grocery arm, secured conditional planning permission from Westminster City Council on Tuesday evening.
The unanimous decision by the council’s planning sub-committee, made on the basis of exceptional circumstances, could see up to 28,135 square metres of the shop floor converted to offices – or 45%.
Ordinarily, Westminster’s planning laws state that development proposals should “sustain and enhance the vitality and viability” of its “globally renowned retail destinations”.
The company – already struggling in a rapidly evolving retail environment – has been hard hit by the pandemic and announced earlier this month it wants to save £300 million each year by 2022.
It saw a £635 million pre-tax loss for the first six months to July following a £470 million write down on its stores.
In July, it revealed 1,300 jobs were at risk due to the planned closure of eight John Lewis stores, and that a further 124 jobs were on the line with the closure of four Waitrose stores.
Staff recently learned they will not receive a bonus for the first time since 1953.
But the retail giant hopes to swiftly return to profits of £200 million in the next two years and £400 million by 2025 through a programme of rapid diversification.
As well as growing its financial services arm, it has plans to expand into housing with 20 sites earmarked for potential development.
According to the real estate adviser Altus Group, the John Lewis Oxford Street store in its entirety has a rental value on the open market of £19.91 million – the third highest in England.
Elsewhere, the John Lewis Partnership is planning to invest £1 billion over the next five years to grow its online operations.
The Waitrose delivery business also grew during the pandemic and it recently announced plans to expand its rapid delivery service through Deliveroo.