Property division of supermarket giant plans to develop leisure, commercial and residential projects.

J Sainsbury is to broaden its developments to include leisure, residential and commercial projects around its supermarket sites. The new path for Sainsbury is part of the restructuring of its property division, which controls the supermarket’s £4.5bn estate. Property will become a separate business unit within the retailer charged with identifying development opportunities in the vicinity of its 440 stores as well as finding sites for new supermarkets and their adjacent mixed-use schemes.

The unit, known within the company as Propco, aims to make £300m over the next four years.Sainsbury currently operates a framework system for its suppliers and consultants. It is thought that its three construction managers – Schal, PCM and RGCM – will not be immediately affected by the new structure.

A spokesperson for Sainsbury’s property division said: “We are going through quite a change at the moment. I can’t see the relationships changing hugely, but as the projects move forward time will tell.” A source at one of the construction managers welcomed the move. “A lot of the developments have been on hold while they sorted out the restructuring. The foot is off the break now, which is good news,” he said.

Sainsbury already has a blueprint development in train at Nine Elms in south-west London. This is a £125m mixed-use scheme that the retailer is planning in association with developer Stannifer and architect Hamilton Associates.

Developments have been on hold. The foot is off the break now, which is good news

Source at Construction Manager

It will consist of a supermarket, 282 flats and a 160-bedroom hotel. A platform built over the store will house a 4100 m2 health centre including a swimming pool. The scheme is waiting for planning permission. Plans for similar mixed-use schemes are being considered for Peterborough, Maidenhead and High Wycombe.

The new business unit will be divided into three areas: development and portfolio planning, delivery and performance The development arm will aim to maximise the return on existing assets and identify sites for development. Delivery will handle the construction process and store refurbishment, extension and facilities management. The performance division will look after the financial returns of the business and customer satisfaction.

The restructured property unit will be headed by group property director Ian Coull. Chris Fenner, currently director of property, will become director of delivery within the new structure reporting to Ian Coull. The directors of development and performance have yet to be appointed.