Sheffield council official describes £3.4 million deal to buy John Lewis as a ‘shrewd move’

A £3.4m deal to buy the John Lewis building in Sheffield was a ‘shrewd’ move that gives the city council the chance to ‘do something special’ with the building, an official has said.

Friday, 26th March 2021, 10:02 am

Nalin Seneviratne, director of city centre development, said taking on the building in Barker’s Pool meant it would not become a bookies, a pound shop or be left boarded up.

The plot alone was worth more than they paid for it, he added.

And John Lewis would have to pay out for breaking a 20-year rent agreement signed last summer.

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John Lewis Sheffield will close, it has been announced.

But he could not talk about the loss of business rates, believed to be £614,000 annually.

John Lewis has announced plans not to reopen the store, blaming the pandemic and internet shopping, putting 299 jobs at risk.

The bombshell move will have a huge impact on the city centre’s retail offer.

But it would have been worse if the city council did not own the building, Mr Seneviratne said.

Nalin Seneviratne, director for city centre development.

He added: “It wasn’t a gamble, it was a shrewd move. If we hadn’t done the deal John Lewis could have let it as the biggest betting shop on the planet, or a pound shop or boarded it up.

“Now we have the opportunity to do something really exciting in a cracking location. As a city I’m sure we can come up with some fantastic ideas.”

Uses could include retail concessions from John Lewis and Debenhams, which is also closing, independent shops, workspace, workshops, artists’ studios, food, drink and even education.

The company is expected to vacate the building in summer after a consultation with staff ends in June.

It was important to have a ‘meanwhile’ use to keep the lights on Mr Seneviratne said.

He added: “My heart goes out to the all the people who are losing their jobs.”

Meanwhile negotiations would take place over the amount of the penalty payment.

He added: “That has got to be determined by professionals but I’m optimistic after dealing with John Lewis for eight years that they will do the right thing.”

Discussions were also needed about the use of the car park, he added.

Sheffield City Council owns the freehold.

John Lewis bought a 99-year lease in 1963 which had 42 years to run.

In that time, it paid the council a peppercorn ground rent.

Last year, the authority bought John Lewis out of the lease for £3m, taking control of the building and the land it stands on.

The council then offered to pay a contribution towards refurbishment of the building. In return, John Lewis entered into a new 20-year deal paying rent based on turnover.

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Thank you. Nancy Fielder, editor.