The increase in available permitted development rights for the development of former agricultural buildings has led to us seeing a sharp increase in the number of properties being sold with the benefit of prior approval for such development.
Unfortunately, that increase has also led to us becoming involved in cases where overreliance has been placed on the value of prior approval in circumstances where other factors mean that the development for which prior approval was obtained does not meet the other conditions of the relevant permitted development right, and as such cannot proceed.
Understandably, such cases can cause a significant amount of frustration for both buyers and sellers, particularly in cases where a substantial uplift in value has been obtained on the basis of the development potential.
To understand the shortcomings in relying solely on the existence prior approval, it is first necessary to understand what this is.
What is prior approval?
Prior approval is a pre-condition of development under a number of the available permitted development rights. The majority of larger agricultural conversions require the grant of prior approval in respect of certain aspects of the development. These vary depending on the use class being relied on, but generally address matters such as contamination, transport and highways impacts and flooding.
Most importantly, a prior approval is not a planning permission. As was recently confirmed in the case of Wokingham the benefit of planning permission for a development pursuant to permitted development rights extends only to works that are in compliance with both the requirements of that right, and the details provided as part of the prior approval application.
The two areas we see lead to the majority of problems are, in the case of all agricultural conversions, the actual use of the building prior to the conversion, and in the case of conversions to residential dwellings pursuant to Class Q, the ability of the building(s) in question to be converted, as opposed to being rebuilt. We explore each of these in further detail below.
All agricultural conversions
Classes Q, R and S require that, on the requisite date, a building was used solely for agricultural purposes as part of an established agricultural unit to benefit from the permitted development rights available. The use of a building at a particular time is a question of fact, and not one that is established (or otherwise) by the existence of a prior approval.
We have become aware of cases where, following the grant of prior approval, questions have been raised as to the actual use of the building to be converted at the relevant date. If it can be demonstrated that the building had been put to another use at that time, or the agricultural use of the building had been abandoned, the benefit of the permitted development right is lost. Such occurrences are particularly problematic where a property has been purchased solely for the purposes of development or where development work has already begun.
Conversions to residential use
The second issue, in relation to the ability of buildings to be converted to residential use under Class Q as opposed to being rebuilt, is one we are seeing with increasing frequency. This may, in part, be due to the reduction in availability of suitable buildings, with the best examples having already been converted. Unfortunately, without proper investigations having taken place, it has been known for these structural shortcomings to only come to light with the building collapsing part-way through the conversion works. The letter of the law in these cases is particularly severe, as without a building, there is nothing left to convert. With many agricultural buildings being in the open countryside or other locations where planning permission wouldn’t ordinarily be granted, this can spell the end of any development potential at the site.
How to help protect your position
Taking into account the above, it is clear that both buyers and sellers of property with the purported benefit of permitted development rights for the conversion of agricultural property need to do more than obtain or rely on the existence of the grant of a prior approval application. Robust due diligence needs to be undertaken to ensure that all of the conditions of the prior approval rights are properly fulfilled to avoid something coming to light that either frustrates a sale, or, arguably worse, leads to the Local Planning Authority stopping a conversion in its tracks, with all of the potential financial, and other, consequences that might have.