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Supermarket merger could trigger release of sites for homes

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Supermarkets that do not ‘survive’ the £15 billion mega-merger between grocery giants Sainsbury’s and Asda could become prime sites for redevelopment, architects have claimed

The deal, details of which were revealed yesterday, would see Walmart subsidiary Asda combine with Sainsbury’s to overtake Tesco with the biggest market share and combined revenues of £51 billion.

Amid fears over job losses, Sainsbury’s has insisted that it does not expect to shut any stores arguing that its footprint is more focused on the south of the UK, while Asda has more stores in the North.

But competition watchdog the Competition and Markets Authority (CMA) is expected to insist on disposals where both retailers predominate in local markets.

Retail analyst Nick Bubb said: ‘The main debate is how many stores Sainsbury’s/Asda will have to promise to sell to placate the CMA.

‘Too many store disposals and the deal won’t be worth doing; too few store disposals and the CMA will look toothless,’ he told AJ’s sister title Construction News.

Assael Architecture director Dipa Joshi said she thought the merger could lead to ‘significant numbers’ of stores being closed, presenting a ‘unique opportunity’ to convert sites into much-needed homes.’

She added: ‘The brownfield sites that don’t survive the merger would be extremely well placed to provide new homes and communities, amid a well-documented housing crisis in the UK.

‘The majority of the sites have great road connections and are near public transport links, as well as being located on the fringes of key urban locations, making them ideal sites to bring forward for development.’

Holly Lewis, co-founding partner at London-based studio We Made That, said: ‘Here’s hoping that this merger is an opportunity to rethink some of the big single-use sites that Sainsburys and ASDA currently occupy, as well as their back of house operations.’

She added: ‘These major urban players should take the chance to think about the future of their role in creating intensified sites in our high streets and town centres, hand-in-hand with the future of their bottom line.’

But Matter Architecture director Roland Karthaus warned that turning retail sites over to housing could be ‘disastrous’ for town centres and high streets.

‘Desperate for the investment, planners have not done enough to require mixed-use developments with housing above adaptable spaces that can be stripped back and reconfigured as times change,’ he said.

‘Predicting the future is a mug’s game, but we can plan for change by mixing together these ingredients: affordable housing, food, shopping and urban life.’

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