Question

I have heard through contacts that permitted development rights are going to be extended to light industrial units - what does this mean for me as a developer?

Answer

To quote from an official Government press release from October 2015, new measures are being put in place to make it easier to turn underused commercial buildings into new homes: "thousands more homes to be developed in planning shake up."

New rights to convert property from light industrial use (Class B1(c)) to residential (Class C) were introduced in the Town and Country Planning (General Permitted Development) (England) (Amendment) Order 2016 - "the Order". First introduced in 2013, temporary permitted development rights initially enabled offices to be converted to new homes without the need for the developer to apply for planning permission. Take up was significant, with many thousands of conversions being given the go-ahead, and the temporary rights relating to offices were subsequently made permanent. The Order is a further example of the Government seeking to cut through the unnecessary red tape and bureaucracy that previously hampered the conversion of underused commercial and industrial space into new homes, by further deregulating and simplifying the planning regime.

Planning permission is not needed when the existing and proposed uses are within the same "use class", or where the Order specifically permits a change to another approved use class. For example, under the latest updates to the legislation, which came into force on 23 May 2017, shops, offices, casinos, amusement arcades and agricultural buildings may all be converted to Class C3 dwelling houses, subject to "prior approval" by the relevant local planning authority. Prior approval will cover issues such as flooding risk, contamination, highways and transport issues and noise impacts on the intended occupiers of the development. But planning permission is not required.

In relation to light industrial premises, the Order permits development consisting of a change of use of a building and any land within its curtilage to use as a Class C3 dwelling house, subject to certain limitations and conditions. The new temporary permitted development right will apply to any prior approval applications made on or after 1 October 2017, and where the prior approval date occurs on or before 30 September 2020. The two key restrictions are that the gross floor space of the existing light industrial building must not exceed 500 square metres; and the development must be completed within three years of the prior approval date.

Prior approval in relation to light industrial premises will be required in relation to issues such as the transport and highways impacts of the development, contamination and flooding risks, and whether the conversion to residential use would have an adverse impact on the sustainability of the provision of industrial services in that area. It may be that in heavily industrial areas, prior approval will be less likely to be given. The new right is more likely to be of use in relation to the conversion of light industrial units that are sited in largely residential areas.

How many such light industrial buildings will be appropriate for conversion to residential use? Finding good quality sites is always an issue for developers, but the relaxation of planning restrictions provided by the Order represents a great new opportunity that any landowners and developers should be aware of. The new regime significantly increases the scope for developers to create value from existing premises.