In a statement issued earlier this week, the Government announced that it will be extending the temporary permitted development (PD) rights introduced in 2013 beyond their current expiry date of 30 May 2016.  This allows conversion of office premises to residential use, subject only to local authority prior approval of a limited range of matters – as opposed to a more ‘traditional’ application for permission being required.

Background

During summer 2014, as part of its ‘Technical Consultation on Planning’, the coalition government considered various measures designed to streamline and simplify the planning process.  It was proposed to:

  • extend existing PD rights allowing offices (Use Class B1(a)) to be converted into new homes / residential (C3);
  • remove exemptions preventing ‘office-to-resi’ conversions in areas considered by the government as “strategically important”, such as central London; and
  • establish new PD rights to allow the creation of homes in buildings used for light industry B1(c) and warehousing (B8), subject to prior approval of certain matters – such as with B1(a) to C3 conversions.

However, in the pre-election statutory instrument subsequently laid before Parliament by Sir Eric Pickles (then Communities Secretary), the measures were absent.  Only an accompanying statement made reference to the possibility of extending the changes, noting that ministers would “further consider the case”.

The Permitted Development Right

Measures now unveiled under the Housing and Planning Bill indicate the temporary changes are to be permanent.  The B1(a) to C3 change was previously only to operate to a 30 May 2016 expiry date, with conversions having to be completed by May 2019.  Now developers and owners are no longer so restricted.  Office-to-resi conversions can proceed under PD rights, rather than a more detailed planning application having to be submitted, but subject to prior approval from the local authority in relation to flooding, highways, transport and contamination impacts.  

It is understood that the existing exemptions from the PD rights for areas the government consider to be ‘strategically important’ will remain.  Ministers previously exempted 33 areas across 17 local authorities, following concerns regarding the adverse impact on employment.  It seems protection for such areas is to remain, potentially limiting opportunities for conversions to ‘exclusive’ residential use-areas in the City, Westminster and surrounding boroughs. 

WM Comment

Since their introduction in May 2013, there has already been considerable use of the ‘office-to-resi’ PD rights.  An Estates Gazette report in late summer 2014 highlighted that the combined number of applications (including conversions involving both demolition and refurbishment of offices) in the capital had approximately doubled since the new rights were introduced.  Applications for conversion by refurbishment had increased over tenfold, with almost 90 percent of central London applications being made through the new PD rights.  The Government’s statement notes that almost 4,000 conversions have been given the go-ahead between April 2014 and June 2015 alone.

Ongoing expansion by the main supermarket chains into the convenience and high-street sectors does mean that some of the infrastructure needed to support these conversions exists.  However, whether other adequate provisions are in place remains to be seen.  In some cases a building’s surroundings may just not be sufficient to sustain residency, particularly when accompanied by the absence of any sense of ‘community’ that is likely. 

Making these PD rights permanent also runs contrary to the Government’s localism agenda, via which it aimed to give power for planning decision-making to local communities.  However, it does reflect the Government’s expressed commitment to ensuring the planning system does not unnecessarily obstruct fulfilment of the country’s housing needs and boost housing supply going forward. 
Whether this will help or hinder economic growth remains to be seen.  While certainly leading to loss of scarce employment space, conversions can rejuvenate underused commercial space.  Stringent assessment of physical feasibility and financial viability is still required to ensure development projects are realistic.