The Government has announced the introduction of new permitted development rights to allow the change of use from offices to residential use without the need to secure planning permission. This is intended to facilitate growth, create jobs in the construction and service industries, and regenerate our town centres. The new regulations should come into force in the Spring. When exactly? Ask Eric Pickles!
A prior approval process covering significant transport and highways impacts, development in areas of high flood risk, land contamination and safety hazard zones will be in place. In practical terms, it is anticipated that this will mean a written request will need to be made to the relevant Local Authority prior to the change of use proceeding.
The permitted development rights are understood to apply to both vacant and occupied offices with no need to provide evidence that the offices have been marketed without success for any period of time. Any external alterations that would currently require planning permission or listed building consent will continue to do so.
Local Authorities may be able to remove the permitted development rights in Conservation Areas. Listed building consent might still be required for any internal alterations resulting from the proposed change of use.
Local Authorities have the opportunity to seek to opt out of these new permitted development rights where this can be justified on economic grounds. However, exemptions will only be granted in exceptional circumstances. The new regulations will have effect for a period of three years, following which the Government will review the benefits and impacts of this new flexibility.
We expect that only a limited number of exemptions will be granted, most notably in the City of London where it is considered that the introduction of ad-hoc housing may have an adverse impact on the global financial district and in particular the future development of new large scale office spaces within the Square Mile.
The details of how the new permitted development rights will sit with existing policies on affordable housing, space standards, parking standards and the Community Infrastructure Levy are to be confirmed.
The proposed easing of the rules has generally been well received within the property industry with investors and developers welcoming the greater flexibility that the changes propose. The sustainability sector has also welcomed the proposed changes as a step towards enabling development of buildings that can ‘swap’ uses during the course of their lifetime in response to demand.
Now is the time for owners, investors and developers to re-assess the performance of their office assets against the potential to release significant returns from conversion to residential as well as considering potential new purchases.
The challenge will be less in relation to obtaining planning permission and the focus will be in respect of economic viability of conversion. As a consequence we predict a significant increase in activity in this area, particularly in respect of under-performing offices in good residential locations.
Further changes, to be introduced to permitted rights, will allow the conversion of agricultural buildings into retail, office and leisure uses (but not residential) subject to a size threshold (to be confirmed) and a prior approval process, the increase in the threshold of permitted development rights in the B use class from 235 sq m to 500 sq m, and the temporary (for up to 2 years) change of a range of town centre buildings to shops, financial and professional services, restaurants and cafes and offices.
For further advice please do not hesitate to contact us.