What with the pandemic and the lockdown and the recession, retailers haven’t had the easiest of years – and thanks to the inexorable rise of online shopping, many of them weren’t in the best of states to begin with. It’s of no surprise, then, that they’d be looking for new sources of income. What may be more surprising, though, is that some of them are looking to renters to get it.
Last autumn, John Lewisannounced it had identified 20 sites on which to build new housing, which it planned to rent out to provide long-term income. Its accounts for the last year showed losses of over £500 million, so it’s no wonder the company is looking for other ways to make cash. By 2030, the company said, it hoped that as much as 40 per cent of its profits would come from “non-retail” activities, with housing as a cornerstone.
Retail giant John Lewis could soon move into the housing market, aiming to provide affordable homes and make up for its losses through the pandemic https://t.co/xShysBoRwU
— The Big Issue (@BigIssue) March 22, 2021
Lockdowns have taken income away from hundreds of Big Issue sellers. Support The Big Issue and our vendors by signing up for a subscription.
John Lewis is, if such a thing can be said to exist, a much-loved company, associated with employee shareholding and cutesy Christmas ads, and it claims its new homes will be “affordable”. Other companies may take a less cosy approach to getting into the landlord game. In January, Goldman Sachs (what’s the opposite of a much-loved company?) spent £150m on a build-to-rent portfolio in north west England. A number of shopping centre companies, like Intu and Hammerson, meanwhile, are also talking about moving from renting to retailers into renting to people.
This is a new departure for the British housing market, but it’s more common elsewhere. The USA’s corporate-owned housing sector has ballooned since the credit crunch, for uncomfortable reasons you can probably guess at. Less soul-crushingly, big companies have owned a big share of the large German rental market for decades. At any rate: ten years ago, the odds a rented flat you were interested in would be owned by a corporation were tiny; ten years from now, it could happen rather a lot.