The Government has this week set aside speculation around the expiry of office to residential permitted development rights by confirming that they will be made permanent with a few key changes.
The rights remove the requirement for an application for planning permission to change a building from office to residential use and replace it with a simpler ‘prior approval’ process. The rights were previously set to expire on 30 May 2016. Key changes that have been announced are listed below.
- Cancelation of existing exemptions: all existing exemptions (which cover areas including the City of London and the Central Activities Zone) will be removed. There are no proposals for a replacement exemption regime.
- Transitional provisions to allow for Article 4 directions to be made: The exemptions will not be removed until May 2019. This is intended to allow local authorities time to make Article 4 directions and is in line with speculation before the Parliamentary summer recess. A local authority can make an Article 4 direction over a particular area, reintroducing the requirement for an application for planning permission for a conversion. However, Article 4 directions take time and resource to put in place, must be based on robust justification and risk modification by the Secretary of State or legal challenge. They also expose a local authority to compensation liability in certain circumstances. Research by CBRE on behalf of the British Council for Offices launched on 10 September 2015 revealed that only around 10% of the authorities that had sought unsuccessfully to secure an exemption under the current regime went on to make an Article 4 direction.
- 3 years to complete the change of use: a 3 year period to complete the change of use will be introduced. This will also apply to conversions for which prior approval has already been given. No further guidance or information has been given on what ‘complete’ means. This is an area that has already been the subject of much debate in the context of the cut-off date under the current regime, including the evidence required to demonstrate that a residential use has begun and the effect of some (but not all) units within a block being occupied.
- Permitted development to include demolition and new build: the announcement states that ‘rights will in future allow the demolition of office buildings and new building for residential use’. Further details are awaited on the associated limitations and prior approval by the local planning authority.
No changes to the existing prior approval criteria have been proposed. The Government had previously consulted on introducing a new criterion that would allow local authorities to consider the ‘potential impact of the significant loss of the most strategically important office accommodation’.
The announcement puts an end to the uncertainty for developers and the building industry, which had caused a number of conversions to be put on hold or cancelled.
Following the announcement, Housing and Planning Minister Brandon Lewis revealed that there will also be a new permitted development right enabling the change of use of light industrial buildings and launderettes to new homes.