The John Lewis Partnership has been advised that its flagship property scheme will face “extreme challenges” in making profit.
The plans would see 428 new flats built above a Waitrose in West Ealing and 353 in Bromley, with ambition to deliver 35% affordable housing on each scheme.
However, this could cost significantly more to build than it would be worth on paper, as planning documents show it risks delivering a negative return of £57m, The Telegraph reported.
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Specialist planning and development consultants, Quod, undertook the official early analysis commissioned by the partnership, and said the “financial viability of the scheme is extremely challenging”.
According to current evaluations, the project would cost around £240m to finish, but would be worth a smaller figure of £183m.
The scheme comes as John Lewis chair, Dame Sharon White, looks to diversity the company away from retail, as the business aims to make two-fifths of profit from non-retail areas by 2030.
The John Lewis Partnership posted a £234m full-year loss in March while debts at the business have swelled to £1.7bn, with £350m due to be repaid in the next two years.
In June, White promised to “get the partnership back to sustainable profit” before 2026, however warned that this may require external investment.
1 Comment. Leave new
Is this another expensive mistake by the powers that be which will impact on the Partners who had no say in this !