Converting commercial spaces: Legislative changes aiming to fast-track housing provision

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One of the most fundamental principles of planning law is that works which constitute development require planning permission. Commonly, securing planning permission requires the submission of an application to the local planning authority. Thankfully, for certain relatively minor or routine forms of development, planning permission is deemed to already exist without the need to apply to the local planning authority: this is known as permitted development.

The Town and Country Planning (General Permitted Development) (England) Order 2015 (the GPDO) specifies the types of development that is permitted development in England. The GPDO also specifies limitations on the extent of what constitutes permitted development and imposes automatic conditions which developers must comply with. Certain types of permitted development also require prior approval from the local planning authority for certain aspects of the works.

One form of permitted development under the GPDO is Class MA: development consisting of a change of use of a building and any land within its curtilage from a use falling within Class E (commercial, business and service) to a use falling within Class C3 (dwellinghouses).

Until very recently, this development would not be defined a permitted development:

• Unless the building had been vacant for a continuous period of at least three months immediately prior to the date of an application for prior approval; and/or
• If the cumulative floor space of the existing building changing use exceeded 1,500 square metres.

Changes

Following the Town and Country Planning (General Permitted Development) (England) (Amendment) Order 2024, which took effect on 5 March 2024, these limitations have been removed.

This short and subtle legislative update provides both a notable opportunity for developers, and potentially significant headaches for local planning authorities. It is likely that such conversions will be focused on high street and other light-commercial areas.

The principle of permitted development rights enabling the conversion of certain commercial uses to residential has been around for several years. Its key purpose is to enable the revitalisation of high streets and other commercial buildings lacking demand by allowing developers to create new homes more easily.

Removing the need for a continuous three-month vacancy will allow developers to proceed with their proposals sooner, without needing to wait for a potentially expensive vacancy period to accrue. This means developers could begin the development process before existing tenants have moved out.

Removing the floor space cap opens up an increasing number of buildings which can benefit from the deemed planning permission for this change of use. This may also make the development process more commercially viable when achievable on a larger scale.

However, from a place-making, residential safety and community harmony perspective, a generalised allowance for conversion of commercial buildings to residential dwellinghouses use may not always be appropriate or desirable.

Protections

Thankfully, despite removal of these two limitations, significant safeguards remain over the use of this permitted development right.

Firstly, there is a remaining requirement for the building to have been used for a relevant commercial purpose for a continuous period of at least two years before the date of an application for prior approval. This will stop developers seeking to game the system by introducing a short-term change to commercial use to take advantage of the permitted development right.

There are also other notable limitations, including the permitted development right not applying for certain types of buildings, such as listed buildings or scheduled monuments (among others). Also, they do not apply in certain areas, including areas of outstanding natural beauty.

Before the development can begin, the developer must apply to the local planning authority for a determination as to whether the prior approval of the authority will be required for various aspects of the development.

These include:

• Transport impacts, particularly safe site access
• Contamination or flooding risks
• Impacts from noise from commercial premises on the intended occupiers
• Impacts on conservation areas (for ground floor changes of use in such areas)
• Provision of adequate natural light in habitable rooms
• The impact on intended occupiers of the introduction of residential use in an area the authority considers to be important for general or heavy industry, waste management, storage and distribution or a mix of such uses
• Considerations to be given to the potential loss of nurseries or health centres
• Fire safety concerns in some cases.

Local planning authorities do retain a degree of control over the location and extent of use of the permitted development right.

Ultimately, if a local planning authority is concerned about a wide-spread inappropriate use of this right, they can introduce a direction disapplying this permitted development right in their area (known as an Article 4 Direction).

Despite safeguards, concerns remain as to whether the dwellings resulting from these conversions will be fit-for-purpose and sufficiently safe. Insurers may wish to consider both the planning approach to and construction status of such developments if approached to offer insurance products on newly converted buildings.

While the removal of the three months vacancy requirement and floorspace limitation will help unlock some otherwise ineligible or unviable sites, it is unlikely this legislative update will be the sole catalyst for solving a chronic shortage of housing.