John Lewis Partnership withdraws from ambitious rental housing construction plan

British retail group John Lewis Partnership (JLP) has definitively ended its five-year foray into the housing construction sector. On Wednesday, the company announced its withdrawal from the Build to Rent venture, which was intended as a response to difficulties in traditional retail. The ambitious plan, announced under the leadership of then-Chair Dame Sharon White, envisioned creating around 10,000 affordable rental homes, of which 7,000 were to be built on land already owned by the company. As explained by a JLP spokesperson, the project was based on a completely different financial environment, characterized by stable investment returns, low borrowing costs, and affordable construction costs. „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. Unfortunately, the current climate - higher interest rates, inflationary pressures and a more cautious property market - has meant the model no longer meets the Partnership's investment criteria.” — John Lewis Partnership spokesperson The decision is therefore directly linked to global economic phenomena that have also affected many other development and investment ventures in recent years. John Lewis Partnership is the UK's largest employee-owned company, structurally resembling a cooperative. This model, known as a partnership, has been the foundation of its corporate culture and strategy for decades. Faced with increasing competition from online retailers, the company has been seeking new revenue streams beyond traditional retail for years. The current move is part of a broader refocusing on its core business, namely the John Lewis and Waitrose brands. As reported by Reuters, the decision to withdraw from property is part of a "broader strategic decision to refocus on its core retail brands." This means the company is returning to what it knows best, abandoning diversification that proved too risky in the changed macroeconomic conditions. Following the project's closure, the small team managing it will be transferred to other departments within the group.