Now that a number of authorities are up and running with CIL, developers and their professional advisers are looking closely at the wording of the CIL Regulations and we are beginning to see the practical effects of how these are drafted.
We have recently spent some time focusing on how the 'existing building' off-set provisions in Reg 40 work, and were interested to see an EGi article yesterday, quoting concerns about this from the property industry.
In brief, the provisions in Reg 40 state that if there is an existing building on the development site which has been occupied - in part at least - for acontinuous period of at least 6 months in the 12 months preceding the grant of consent (or final approval of all reserved matters), and either that building is to be demolished as part of the new development or will be retained and form part of it, the area of development chargeable to CIL will be reduced by the gross internal area of that existing building.
This appears to be helpful on a first reading, but developers are concerned that it does not go far enough: in the case of empty buildings (ie those which do not satisfy the 6 month occupied test) will mean that CIL is payable in relation to the floorspace of the entire building, rather than just the floorspace of any minor extensions.
The difference in the figures could be hugely costly, and could pose a real threat to regeneration projects.
It would be well worth property professionals getting to grips with Reg 40 at an early stage, to avoid nasty surprises further down the line.