SUPERMARKETS are planning to build thousands of homes over the next few years as part of creative schemes to secure planning permission for new stores and extensions.

Asda and J Sainsbury both plan to build about 1,600 homes over the next three years while Tesco, the UK’s largest supermarket chain, is planning to build more than 1,000 homes in the next year.

The supermarkets are responding to increasing pressure from local councils for the inclusion of social housing and regeneration projects as part of redevelopment schemes.

London, where there is little available space for redevelopment and immense demand for new homes, has led the way, but more provincial councils are insisting that supermarkets build affordable housing in exchange for planning consent.

Dominic Grace, head of new homes for FPD Savills, the property company, said: “It’s happening everywhere. Virtually no new supermarket planned for a free-standing site in London can be built without housing on top.”

Sainsbury’s built fewer than 100 homes last year as part of store development projects but this is being increased to 1,600 over the next three years.

Rather than build the housing themselves, the supermarkets are working with a mix of partners including housing associations and construction companies.

Tesco, for example, built 100 affordable flats alongside its new store in Hammersmith, West London, with the Peabody Trust, a housing association. In Clapham, South London, the supermarket is working with a housing association to create about 100 flats above a new supermarket.

The development schemes are not limited to housing. By working closely with local councils on regeneration projects, supermarkets can gain valuable access to land.

A spokesman for Asda said: “As government planning policy now steers new retail development towards town centres, many brownfield sites are being regenerated. We like to work in partnership with local authorities to identify specific areas in which we help to boost. We often play a part in a wide range of mixed-use schemes, which are becoming increasingly popular, incorporating residential, leisure or educational facilities.”

In Poole, Dorset, Asda has invested £30 million in a project to develop a waterfront scheme including a 58,000 sq ft store.

The development on a formerly derelict site will include 64 social housing flats, 98 waterside apartments a car park, new offices, hotel and a commercial leisure scheme.

Sainsbury’s and Tesco are involved in similar schemes and work closely with developers to try to resolve practical problems caused by putting housing above businesses that can be open 24 hours a day.

There are obvious benefits from being involved in house building, but Desmond Taljaard, property director at Sainsbury’s, says its objective is also to make the best use of its land and to create value.

Sainsbury’s has examined its property estate to find locations where it can create developments that might drive footfall and traffic to the store.

It is planning to create new developments involving store extensions, housing and other services on about 50 sites over the next five to seven years.

In Wandsworth, for example, where there is huge customer demand for a bigger store, Sainsbury’s will build flats above a store extension.

Mr Taljaard says: “The local community gets the planning gain of more affordable housing and the land value created from the private scheme will pay for our extension.”