Lidl has ramped up its property development initiative and announced plans to build 3000 homes and a primary school as a tactic to secure planning permission for new stores.
It is understood the discount grocer’s latest move into property development is part of its drive to open 50 stores a year across the UK, seeking to find a way around difficulties in securing planning developments across London.
By promising to build homes and facilities like schools, the retailer has more chances of persuading a local council that a new store could be beneficial for the area.
It can also help offset some of the costs incurred from opening in central locations, such as business rates, by securing more secure rental income.
Lidl is set to build a new store in Richmond which will see Deer Park primary school re-located across two floors above it, due for completion next year.
Alongside the new school building, the German grocer will seek permission to build thousands of homes, having already built 335 since 2008.
This marks a significant step up in its focus on mixed-use developments, and its UK managing director Christian Härtnagel already has 476 new homes in the pipeline, linked to new store locations in Dartford, Epsom and Alperton.
It will reportedly focus on affordable homes and is planning to build around half of them itself, while the rest will be built by third party developers as part of wider schemes.
“We’re proud that our stores are increasingly helping to pave the way for mixed-use developments, which in turn are supporting important initiatives,” Härtnagel said.
“It continues to mean a great deal to us that we are able to support many of the communities that we’re a part of by providing added value above and beyond affordable food.”
Other supermarkets have been playing with this tactic for years.
Tesco and Sainsbury’s have both built hundreds of homes, with the latter embarking on a joint scheme with Barrett Homes.
Morrisons also received permission late last year to build around 600 homes in Camden.