John Lewis scraps rental home project amid shifting economic climate

British department store John Lewis has scrapped its build-to-rent property plans, citing a “fundamental shift in the economic conditions” since the venture was initially launched.

The company is putting a stop to a project that would have built 1,000 homes across the sites, and is further pulling out of the property management business, which will shutter once contracts with four residential buildings end.

John Lewis confirmed the news to multiple media outlets, including the BBC, to which it said: “Our rental property ambition was based on a very different financial environment: one with more stable investment returns, lower borrowing costs, and more affordable costs to build homes.”

The retailer had begun expanding into residential development in 2020 as a means of bringing in more money. Its efforts faced pushback, however, seeing its struggle to secure permission for a site in Bromley and tackling concerns from locals for its Reading project.

Now, with residential plans coming to an end, John Lewis has told the media that it will instead be focusing on its retail brands, John Lewis and Waitrose, with the goal of simplifying the business and strengthening its balance sheet.