News and Comment

The Human System

At the time of writing this, dear reader, I am sitting on a train on my way to a meeting with HM Planning Inspectorate. Its a meeting that I have been invited to as part of their stakeholder engagement in order so that they can understand what they could be doing better!

This is, of course, at a time when the Planning Profession in Local Government is under increased pressure to perform. The government has just released its latest consultation for increased permitted development allowances which will remove more control from the Local Government Planner and, in their eyes, free up more development land within the system.

The latest publication ‘Planning Reform: Supporting the high street
and increasing the delivery of new homes’ makes very clear that the Government needs the planning system to work and, unfortunately, it is the Human Element of that system causing the issue. Fundamentally we have permitted development allowances in order to avoid the need for assessment by planners and in consulting on new allowances the Government is effectively saying that it can not rely on the human part of the system to do this on its own!

The Planning System is, itself, actually quite good at doing what it needs to do. The rules of the system are set nationally and transcribed into a local development framework that has to be consistent with the national approach. Decisions are made against the policies within the Local and National Frameworks and then issued accordingly. That is in essence the system that was set in motion on the 1st July 1947 and the same one that exists today.

So what has gone wrong?

Unfortunately it is the Human part of the system that gets in the way. The mechanic that runs the system and makes it work also has an effect on its output.

Planning applications are not, for example, a production line of input and output. They are not decided upon an expert system (one that requires no prior knowledge from the operator) but instead are decided by individuals working within a broad framework of rules where interpretation and personal preference are encouraged.

To give a true expression of this I want to give a real world example:

Planning permission was granted in 2017 for the demolition of a house and its replacement with two houses within a City (the City will remain nameless to protect the stupid). The design, at the time was deemed acceptable even though it bare no relation to the surroundings and planning permission was passed.

Following approval it was determined that (financially at least) the development would never be carried out. The base numbers were as follows:

Cost of House £200K

Cost of Build £200K

GDV of 2 Houses £400K

Profit £0

Therefore a revised application was made seeking the retention of the host house and the construction of a new house on the land (this would just about work).

Negotiations on design were had with the planning officer and everything was well until her line manager got involved. The storey here is that he did not agree with the original decision and notwithstanding this was not going to agree with a new house in the gap. This got to a point where the planning officer stated that ‘it would be better if it was refused and went to appeal’.

The waste of time and energy that would have caused was immense (5 months to this point with the LPA and and additional 6 months with the Inspectorate!) and all because one human within the system did not agree with a decision made by the LPA.

The interpretative part of the system is what results in both inefficiency and inconsistency in decision making. Happily dear reader the New National Planning Policy Framework gives us a solution.

47. Planning law requires that applications for planning permission be determined in accordance with the development plan, unless material considerations indicate otherwise. Decisions on applications should be made as quickly as possible, and within statutory timescales unless a longer period has been agreed by the applicant in writing.

124. The creation of high quality buildings and places is fundamental to what the planning and development process should achieve. Good design is a key aspect of sustainable development, creates better places in which to live and work and helps make development acceptable to communities. Being clear about design expectations, and how these will be tested, is essential for achieving this. So too is effective engagement between applicants, communities, local planning authorities and other interests throughout the process.

125. Plans should, at the most appropriate level, set out a clear design vision and expectations, so that applicants have as much certainty as possible about what is likely to be acceptable. Design policies should be developed with local communities so they reflect local aspirations, and are grounded in an understanding and evaluation of each area’s defining characteristics. Neighbourhood plans can play an important role in identifying the special qualities of each area and explaining how this should be reflected in development.

126. To provide maximum clarity about design expectations at an early stage, plans or supplementary planning documents should use visual tools such as design guides and codes. These provide a framework for creating distinctive places, with a consistent and high quality standard of design. However their level of detail and degree of prescription should be tailored to the circumstances in each place, and should allow a suitable degree of variety where this would be justified.

Returning to the assessment of design against codes (such as the famous Essex Design Guide) would be both NPPF compliant and create a circumstance where the design expectations of the Council were known. This would create consistency throughout the system and in decision making as interpretation and preference would be removed.

Well written Design Codes can be picked up and used by anyone to create quality places for people to live and work in and bring us as a profession closer to the expert system that planning was always meant to be and whilst I hate to admit it myself the only way IS Essex.

Jon McDermott

 

Pub Conversions – Practical Application

The number of pubs in the UK has declined year on year, at least since 1982. Various reasons are put forward for this, such as the failure of some establishments to keep up with customer requirements. Others claim the smoking ban of 2007, intense competition from gastro-pubs, the availability of cheap alcohol in supermarkets or the general economic climate are either to blame, or are factors in the decline. Changes in demographics may be an additional factor.

In 2015 the rate of pub closures came under the scrutiny of Parliament in the UK, with a promise of legislation to improve relations between owners and tenants. The Lost Pubs Project listed 31,301 closed English pubs on 19 July 2016, with photographs of over 16,000.

In the fifteen years to 2017 a quarter of London’s pubs had closed. The closures have been ascribed to factors such as changing tastes and the rise in the cost of beer due to applied taxes.

Public houses make fantastic conversion projects. Normally you have a substantial building on the site with large garden and car park. Large country pubs are even larger and are set within quaint villages in rolling open countryside. They are, in the main, a developers dream site as they meet many of the exempt-able criteria for development in the countryside in the National Planning Policy Framework.

Pub’s are however protected entities in the eyes of National Planning Policy. Para 92(a) of the NPPF states:

  1. To provide the social, recreational and cultural facilities and services the community needs, planning policies and decisions should:

  1. a) plan positively for the provision and use of shared spaces, community facilities (such as local shops, meeting places, sports venues, open space, cultural buildings, public houses and places of worship) and other local services to enhance the sustainability of communities and residential environments.

Unfortunately there are no permitted development allowances that assist here. Class A, Pt 3 Sch 2 of the General Permitted Development Order) no longer allows the change of use of a Public House (thanks CAMRA) to a shop or an estate agent so you have to apply for planning permission in order to change the use of such a building to dwellings.

Happily there is some consistency in how most councils deal with this.

In the main you need one of two things to be true in order to proceed with a pub conversion:

  1. The building has been vacant for at least 5 years and is on the Council’s brownfield register
  2. The building is not identified as an asset of community value
  3. The building has been marketed as a public house for at least 12 months and has not sold.
  4. The public house is listed and the benefits of retaining and

In these circumstances most policies will allow a public house to be converted subject to the normal planning criteria.

If none of these are true then what options do you have?

Public houses often come with excessive lands which they no longer want or need. They are often also equipped with car parks that they do not need anymore as (to be honest) it is no longer socially acceptable or legal to drink and drive.

Looking at most car parking standards this is reflected when a Class A4 public houses car parking standard is missing or very low.

The lands around pubs are available for development especially within towns where the presumption of development is set and the desire for new homes is quite high. Hence you can hold the pub for the required marketing period and then pursue houses on the surrounding lands.

What if you don’t want to apply at all?

Within the definition of public house also exists ‘coaching inn’. These entities are public houses with hotel accommodation built in. Think of a serviced accommodation use but with a public house attached to it.

Whilst you would need to actually run the pub you could also use the sleeping accommodation within the serviced model and not require planning permission at all. No change of use = no planning permission required!

 

What next for the High Street

It seems like every day we hear of another High Street Chain filing for administration or bankruptcy. In 2018 (more than ever) the high street is under threat.

Our shopping habits have changed so drastically in the past 10 years that the retailers are not able to maintain pace with the technology that seeks to usurp them.

Take Amazon for example, this company founded in 1994 has grown to be worth 4.1 Billion in 2017 from an online bookstore and support for their kindle e-book reader platform to an online store that sells…everything (well almost).

Granted there is still something about going to see the product you are buying in person however the transaction itself is often now online with better deals to be had. I am as guilty as the next person in doing this. For the last two years my Christmas Shopping was a breeze, I didn’t have to go out in the cold or fight with the queues. I just sat at my laptop with my wife in front of a Sunday afternoon movie and logged onto Very and did everything there. It all arrived and was wrapped (in the paper also bought online) and sent with cards (also bought online).

Planning Policy (at least locally) however has not moved on. It is still stuck in the misty eyed image of Britain in the 30’s where you went and did everything in the high street.

If you look at any planning policy for any town centre in the UK and compare it to the last iteration of that policy, or the one before that. Nothing has changed! In fact in Portsmouth they decided to make the City Centre Bigger! this notwithstanding a City Centre with 15% vacancy and a major retail development site that has been stalled since at least 2002.

Para 23 of the 2012 NPPF states:

23. Planning policies should be positive, promote competitive town centre environments and set out policies for the management and growth of centres over the plan period. In drawing up Local Plans, local planning authorities should:

recognise town centres as the heart of their communities and pursue policies to support their viability and vitality

define a network and hierarchy of centres that is resilient to anticipated future economic changes

define the extent of town centres and primary shopping areas, based on a clear definition of primary and secondary frontages in designated centres, and set policies that make clear which uses will be permitted in such locations

promote competitive town centres that provide customer choice and a diverse retail offer and which reflect the individuality of town centres

retain and enhance existing markets and, where appropriate, re-introduce or create new ones, ensuring that markets remain attractive and competitive

allocate a range of suitable sites to meet the scale and type of retail, leisure, commercial, office, tourism, cultural, community and residential development needed in town centres. It is important that needs for retail, leisure, office and other main town centre uses are met in full and are not compromised by limited site availability. Local planning authorities should therefore undertake an assessment of the need to expand town centres to ensure a sufficient supply of suitable sites

allocate appropriate edge of centre sites for main town centre uses that are well connected to the town centre where suitable and viable town centre sites are not available. If sufficient edge of centre sites cannot be identified, set policies for meeting the identified needs in other accessible locations that are well connected to the town centre

set policies for the consideration of proposals for main town centre uses which cannot be accommodated in or adjacent to town centres

recognise that residential development can play an important role in ensuring the vitality of centres and set out policies to encourage residential development on appropriate sites

where town centres are in decline, local planning authorities should plan positively for their future to encourage economic activity.

This is all well and good however it is often mis-interpreted at Local Plan Making Stage as a ‘maintain the status quo’ as it fails to identify how LPA’s should respond to a town centre in decline.

In academia the solution has been talked about for some time, compaction. This theory postulated by many more intelligent than I ( http://www.reading.ac.uk/PeBBu/state_of_art/urban_approaches/compact_city/compact_city.htm ) encourages the creation of more compact and therefore more efficient urban environments in order to foster regeneration. When applied to town centre’s this would seek the re-drawing of boundaries to make the retail part of the centre smaller. The effect of this would follow a logical chain:

  1. The centre is expansive with vacancies throughout
  2. The boundary of the retail centre is redrawn making the centre smaller
  3. The areas excluded are re-allocated as housing revival areas
  4. The building owners seek to redevelop their properties within the new HRA’s
  5. The existing retailers within the HRA’s move to the vacancies within the compacted town centre. If encouragement is required then CIL or S106 could be used from the development in the HRA to give rent grants of guarantee’s for retailers needing to move.
  6. All of the above would accord with Para 23 of the NPPF but would require a change in practice by the individual LPA.

The same compaction process however can be applied to individual shops without LPA involvement or a radical change in policy.

A large (former BHS or Poundworld) for example in a town centre in decline is typically arranged over two or more stories.

S55(1) and (2aii) of the Town and Country Planning Act allows us to sub-divide that larger unit into say three smaller units by internal alterations only. The ground and first floors are sub-divided accordingly and the units are compacted.

Smaller units are easier to rent in a town centre than larger units as they are more attractive to a wider range of users.

Class G of Part 3 of Schedule 2 of the General Permitted Development Order 2015 (As amended) allows us to then to convert the new upper floor spaces into up to 2 flats above each retail unit.

3 x 2 = 6

Para 23 of the NPPF recognises the importance of residential within a town centre and that’s why Class G exists.

Whenever I speak to developers and they ask ‘what is your favourite permitted development route’ I always give the same answer ‘Class G’. Hopefully you can see why!

I want our town centres to have a purpose however this will never happen if we do not grapple with the problems of today and plan properly for the future. Shopping has gone online, banking is going online ( https://news.sky.com/story/full-list-of-natwest-and-rbs-branches-which-will-close-11151127 ). At this stage the planning profession is waiting for the next big name to announce its departure. But for the property Investor that departure could be the next big opportunity.

Jonathan McDermott

The True Cost of Speed!

I am often asked to act in a hurry! In today’s modern world where everything is at an instant the planning system has, shall we say, failed to react to the need for speed and efficiency.

The planning system still has one Palaeolithic component, namely us! Us humans love to take our time and hate being pressured. Hence the planning system as it presently is is bogged down with applications taking 12-16 weeks at best.

The other thing about rushing an application is something may be missed or done in haste or simply we are being asked to pick up the pieces of an inappropriate strategy.

Let me give you a couple of examples.

The urgent application

 

 

 

 

 

When I give talks to property developers I give a very simple equation.

Prior Approval = Approval BEFORE you start work or change the use.

This is because part (W) of the General Permitted Development Order states at para 11:

(11) The development must not begin before the occurrence of one of the following—

(a)the receipt by the applicant from the local planning authority of a written notice of their determination that such prior approval is not required;
(b)the receipt by the applicant from the local planning authority of a written notice giving their prior approval; or
(c)the expiry of 56 days following the date on which the application under sub-paragraph (2) was received by the local planning authority without the authority notifying the applicant as to whether prior approval is given or refused.

I am frequently amazed therefore how many people ask me whether they can start work prior to receiving prior approval. My answer is always the same.

They must not carry out ‘development’ in accordance with the act.

The definition of development is set out at Section 55(1) of the Town and Country Planning Act and States:

55 Meaning of “development” and “new development”.
(1)Subject to the following provisions of this section, in this Act, except where the context otherwise requires, “development,” means the carrying out of building, engineering, mining or other operations in, on, over or under land, or the making of any material change in the use of any buildings or other land.
F1[(1A) For the purposes of this Act “ building operations ” includes—
(a)demolition of buildings;
(b)rebuilding;
(c)structural alterations of or additions to buildings; and
(d)other operations normally undertaken by a person carrying on business as a builder.]
(2)The following operations or uses of land shall not be taken for the purposes of this Act to involve development of the land—
(a)the carrying out for the maintenance, improvement or other alteration of any building of works which—
(i)affect only the interior of the building, or
(ii)do not materially affect the external appearance of the building,and are not works for making good war damage or works begun after 5th December 1968 for the alteration of a building by providing additional space in it underground;

Whilst this is only part of Section 55 it is a case that if you transgress these rules to say, carrying out the material change of use, then you may not enjoy the prior approval route.

The CIL Trap. 

Applicants who want things done fast often fall into the CIL Trap.

I had an applicant who, presenting a building which had been vacant for 15 years, wanted an application for prior approval right away.

The exemptions to CIL can be found here (https://www.planningportal.co.uk/info/200126/applications/70/community_infrastructure_levy/4) however the biggest one of all is the 6 Months usage in 36 Months Rule.

That is if the building has been used for 6 months in the last 36 you may get a 100% exemption on the CIL generated by the floor area of the existing building.

This particular client did not want to say, rent the building to someone like Regus and gain a rental income for 6 months and then apply after the 6 month exemption period had passed.

The applicant was in a rush and chose to pay the CIL

The maths looked like this:

600sqm per floor over 12 floors = 7200 sqm or 72,000 sqft

Wait with rental income of £10 per sqft = £720,000.00 per annum

or

CIL at £105 sqm =  -£756.000.00

In this case a little bit of patience would have been profitable.

IN conclusion, like any major decision, a planning application should be well thought out and part of a clear build programme which takes into account the true time taken to make said application and the costs therein.

Jonathan McDermott

 

But……. I’m Just a Town Planner

Jon’s flagship talk, Permitted Development and Prior Notification – Planning’s Cheat Codes, continues. Check below for the next tour date!

Next Up – Regents Park PIN 

19-2-2018 Berkshire PIN

20 – 2 – 2018 Regents Park PIN 

7 – 3- 2018 Croydon Property Meet 

18 – 4- 2018 Bloomsbury WIN

2 – 5- 2018 St Pancras PPN

15 – 5 – 2018  Regents Park PIN

21/26 – 5 – 2018 Whitebox Monaco Retreat

26 – 6 – 2018 Blackpool PPN

12 – 07 – 18 Cambridge Property Community

16 – 7 – 2018 Peterborough PPN

17 – 09 – 18 Property Vault talk, Gravesend