John Lewis pays £5m after closing store 10 months into 20-year lease

John Lewis has agreed to pay £5m for closing its Sheffield city centre department store just 10 months in to a 20-year lease.

Jubilant council chiefs say the cash will be used ’towards the future redevelopment of the site’.

But investigations into the cost of repairing the dilapidated building are ongoing - with some speculating it could be more than £10m.

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The deal ends a 20-year saga which saw Sheffield City Council ‘bending over backwards’ to get the company to stay and be part of city centre regeneration plans.

The former John Lewis store in Sheffield

It culminated in the authority buying the building from the firm for £3.4m last summer and renting it back on a 20-year lease for peanuts.

John Lewis then stunned the city when it announced it would close the store in June this year with the loss of 299 jobs.

The firm said it was one of eight it ‘could not profitably sustain’ after losing more than £500m last year. It has since returned to profit.

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Negotiations over breaking the lease in Sheffield have now concluded.

Coun Mazher Iqbal, executive member for city futures, development, culture and regeneration, said it meant the authority had full ownership of the building and the agreement came ‘with no cost impact to the city’.

But he added investigations into the cost of repairs were ongoing.

“It is an anchor site within the Heart of the City masterplan, with so much potential and the council is 100 percent committed to creating something special that the city can be proud of.

“Earlier this year, we instructed sector experts Fourth Street, Queensberry and Arup, to start to examine the condition of the building, as well analyse the costs, market interest and sustainability of all of the available options.

“In the new year we’ll be launching a consultation to find out what the people of Sheffield think about the future of this important site in the city centre and what they’d like to see.

“There have been some really exciting developments on Heart of the City this year, we’re really seeing it take shape now, the vision coming together, and there’s more to come in 2022 – it’s a great time to be living, working in and visiting Sheffield.”

Last month, The Star revealed a major sports brand wants to open a £100m footballing experience in the building, with pitches on the roof.

The John Lewis site sits in the centre of the council’s £470m taxpayer-funded Heart of the City redevelopment which the authority says is ‘forging ahead’.

A report to the council’s Co-operative Executive committee on December 15 says it is set to complete in 2023.

‘About half' of the apartments in Burgess House on Pinstone Street have been sold. It is set to open in February.

Building work continues on a new Radisson Blu hotel, also on Pinstone Street, and a revamp of the old Embrace nightclub.

A ‘deal is also close’ for the space underneath Telephone House. Set to open in spring, campaigners have long hoped it will be a secure bike hub.

On Cambridge STreet, tenants have already signed up for a food hall and Leah’s Yard, which will be a hub for creative businesses and independent retailers. They are set to open in 2023.