On 30 June 2020, the Prime Minister announced that the Government will be bringing forward “the most radical reforms of our planning system since the end of the second world war”. It is expected that these reforms will come into effect by September 2020, with the Government due to publish further details in a policy paper later this month.
In the meantime, the Government has provided some preliminary guidance within a press release which followed the Prime Minister’s speech.
How will the reforms affect property owners?
The Government announced that it intends to provide ‘total flexibility’ to owners of commercial property to change certain uses of premises without having to concern themselves with planning permission. The example given by the Government was a building used for retail, that would be able to be permanently used as a café or office without requiring any planning application.
The effect of reforming the Use Classes Order
The removal of these requirements will be of interest to landlords looking to let their properties, and it will be a welcome relief to any tenants who are planning to assign their lease in the near future.
It will essentially broaden the pool of potential tenants/assignees and maximise the likelihood of finding an assignee which is acceptable to a landlord.
Conversely, businesses who are looking to take on new leases will benefit from the removal of this obstacle as it will allow them to consider a wider range of potential properties, both without the costs and time involved in making a planning application and without the risk of any such planning application being refused.
Are there any exceptions to the proposed reform?
The Government has caveated these reform proposals, citing ‘other uses’ which are outside the scope of these changes. No exhaustive list was provided, but the examples of pubs and libraries were given as those which will not be able to freely change their use.
We will likely have to wait for the Government’s policy paper later this month to see what other types of use will still be bound by the planning legislation as it stands today.
Conversion of Commercial Property to Residential Accommodation
The Government announced that a wider range of commercial buildings will be allowed to convert to residential use without the need for a planning application. In addition, builders will not be required to apply for planning to demolish commercial buildings and re-build them as residential accommodation.
The Lockdown’s detrimental impact on an already struggling High Street, as well as many businesses viewing remote working as the way forward, are both factors leading the Government to expect more vacant shop and office units in the near future. It is therefore not surprising that the Government is now looking to make it easier for vacant buildings to be re-purposed for residential purposes.
An increasing trend
The conversion of commercial property to residential accommodation has been an increasing trend over recent years, driven by a fierce increase in demand. The Government clearly intends to continue this trend, and the proposed reform will be of interest to many developers.
Conversions to residential accommodation can be a very profitable venture for a landlord, especially if they are having difficulty locating a suitable tenant and are faced with the prospect of vacant units over a prolonged period.
Fast-track permissions for residential extensions
It is not just owners of commercial buildings who will benefit from the Government’s planned reforms, as it was further announced that there will be a new ‘fast-track’ process to obtain permission to build extensions above residential blocks.
Whilst the details of this process are not yet known, this will surely be of interest to freehold owners of blocks of flats who are looking to build additional storeys.
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