News and Comment

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

 

 

 

 

Permitted Development 7 Years On

It has been some 7 years since the release of the Town and Country Planning (General Permitted Development) (Amendment) (England) Order 2010. The first in a raft of amendments to the faithful General Permitted Development Order (1995) that became part of the government’s ‘new way’ of planning.

The use of the Permitted Development Orders has become the standard mechanism for the Government to release development land from the grip of the Local Planning Authorities and have become the bane of any Local Authority seeking to preserve employment or retail uses within their areas.

The last 7 years have seen many ‘interpretations’ of the same document so in this article I shall go through some of the pitfalls that have arisen and how budding developers can overcome them.

Knowing the starting use

The biggest pitfall by far is knowing what the authorised starting use is because this can have a massive effect on what permitted development rights are available to you.

To give an example:

Class B1(a) Office and Class A2 Financial and Professional Service

The permitted development allowances for Office (B1a) to residential development is set out within Class O of the 2015 GPDO. The permitted development allowances for Financial and Professional Services (A2) are set out within Classes G and M of the 2015 (GPDO). They are vastly different in terms of their scope. Hence knowing the starting use is vital to knowing what options you have.

The difference between the two uses can be amazingly subtle and comes down to visitation. A Class A2 use is a retail use whose primary function relies on passing trade – people being dragged in off the street to engage with a service. An Office (Class B1a) is a private use who does not require passing trade to function. How closely a use sits into one or another is dependent on how close to either definition the original use gets.

Take a solicitor’s office.

Solicitors can be either B1(a) or A2 depending on how the solicitors themselves operated the business. A solicitors that just did work by email or over the phone or kept records could be B1(a). Alternatively a Solicitor that offered legal aid, walk in appointments and a reception desk is more likely to be in A2.

Knowing the starting use can be critical therefore to understanding what you can and cannot get away with under the Permitted Development Rights and will have massive implications for a decision.

The only way to be 100% sure of a starting use is via a Certificate of Lawful Development or a Planning Permission so the starting point should always be the planning history for any site.

Survey, Survey, Survey.

Classes M (Retail to Resi), N (Sui-Generis uses to Resi), Q (Agriculture to Resi), P (Storage to Resi) and PA (Light Industrial to Resi) are all space limited. What this means is there is a maximum limit on the amount of space you may use to facilitate your conversion.

This is where a detailed survey of the building is critical (not simply relying on the Valuation Office Agency or estate agent figures) as all of the space limits are based on gross floor space not net usable floor space.

The floors areas are maximum limits and are non negotiable.

They are as follows:

Class M – 150sqm
Class N – 150sqm
Class Q – 465sqm
Class P – 500sqm
Class PA – 500sqm

In absence of a detailed survey the Council can and will question the floor area based on the information they have available including the ordnance survey plan for the property. The burden of proof (the requirement to prove the floor area) falls to the applicant and not the Council.

In order to address this problem the solution is to get a detailed survey done at the outset. Never believe what you read!

The Time Travel Paradox

All of the permitted development rights (excluding Class G) include an effective date. This is the date at which the building must have been in use, either for office or retail or storage etc and all of these dates are set some or more 3 years back in time.

This was done in order to prevent a change of use into a prior approval bearing use.

Therefore it is reasonably obvious that you could not expect to change use into one of these prior approval bearing uses and no one would attempt that argument. Not unless they had a time machine anyway!

There are however a number of applicants per year that attempt such a feat and that fall over on this simple point of principle hence the advice always relates back to knowing the starting use and the rules relating to that use.

Information Overload

The rules on the information the Council is allowed to ask for – the information needed to start the 56 day clock are well set out at Class V(W) of Part 3 of Schedule 2 of the General Permitted Development Order (2015).

This states:

W.—(1) The following provisions apply where under this Part a developer is required to make an application to a local planning authority for a determination as to whether the prior approval of the authority will be required.

(2) The application must be accompanied by—

(a)a written description of the proposed development, which, in relation to development proposed under Class C, M, N or Q of this Part, must include any building or other operations;

(b)a plan indicating the site and showing the proposed development;

(c)the developer’s contact address;

(d)the developer’s email address if the developer is content to receive communications electronically; and

(e)where sub-paragraph (6) requires the Environment Agency(1) to be consulted, a site-specific flood risk assessment,

together with any fee required to be paid.

The Council must register and start the clock when they have received the information requirements set out in Class V(W). This message has not, however, filtered down to the staff registering or validating these applications.

The information requirements are strict and inflexible. The Council will always invariably ask for information beyond this. For example they may hold out for a Community Infrastructure Levy Form because it is in their validation list or floorplans because it is considered to assist the application. Unfortunately providing this information can also forestall the registration of an application and may raise questions that ultimately harm the application. Therefore whenever I am advising someone entering into prior notification I always give the same advice. Give the council only what they need and not what they want in order to register and start your application.

Keep an eye on the clock

Your council only get 56 days to answer the prior notification. Thats it! Once the council goes beyond the 56 days and they have not given an answer you have a deemed permission. This means you automatically get what you want when the clock exceeds the 56 day limit.

These 56 days are calendar days not working days. They include boxing days, weekends, christmas, easter, summer holidays and any other time when the LPA is not there!

So long as your application is valid (see class V(W)) then the clock starts the moment they have the required information and the fee. If the Council takes 2 weeks to register then that’s their time.

I recently dealt with this with an Authority on the South Coast.

They were holding out on registration for a Community Infrastructure Levy Form. They had everything else on the list and the fee.

After not hearing from them for the 4 of the 6 weeks they were allowed I contacted them with a gentle reminder that the time period had started and that they had two weeks left.

After a day of waiting on an answer I received a response from the head of service apologising and undertaking to get matters moving as soon as possible.

The moral of the story is that it’s your job to watch the clock. The council will not tell you when things go wrong.

Some Conclusions

Prior notification remains the preferred way of unlocking development of sites across the country and the only effective way of delivering new dwellings in the countryside.

However there are pitfalls out there which should be avoided at all costs.

Knowledge of the rules and the process is the best defence to a planning authority that may be stalling for time.

Planning in Rural Areas

In 2012 the Department for Communities and Local Government was a bit thick. In their drive to simplify the planning system they sought to revolutionize the available government practice guidance by taking some 7000 pages over 25 Planning Policy Guidance (PPG’s) and Planning Policy Statements (PPS’s) to just 65 pages that would form the National Planning Policy Framework (NPPF).

This was (mostly) done by using the DELETE button.

In rural areas the effect to Government Rural Planning Policy was profound. Planning Policy Statement 7: Sustainable Development in Rural Areas was published in August 2004 and for 8 years was the benchmark planning policy document for rural areas. Its 27 pages included provision for frontage infil in rural areas, tests for tourism and agriculture based businesses and most importantly the key rules for new dwellings in the countryside.

It was reduced to 3 paragraphs in the NPPF, Paragraphs 28, 54 and 55. Of these Paragraph 55 is the most important for developers and states:  

  1. To promote sustainable development in rural areas, housing should be

located where it will enhance or maintain the vitality of rural communities.

For example, where there are groups of smaller settlements, development in

one village may support services in a village nearby. Local planning authorities

should avoid new isolated homes in the countryside unless there are special

circumstances such as:

  • the essential need for a rural worker to live permanently at or near their

place of work in the countryside; or

  • where such development would represent the optimal viable use of a

heritage asset or would be appropriate enabling development to secure

the future of heritage assets; or

  • where the development would re-use redundant or disused buildings and

lead to an enhancement to the immediate setting; or

  • the exceptional quality or innovative nature of the design of the dwelling.

Such a design should:

– be truly outstanding or innovative, helping to raise standards of design

more generally in rural areas;

– reflect the highest standards in architecture;

– significantly enhance its immediate setting; and

– be sensitive to the defining characteristics of the local area.

 

All planning decisions are plan lead decisions, they must have regard to the Local Plan or Core Strategy and the National Planning Policy Framework so from Para 55 we can gauge some general rules governing rural planning decisions.

No, now what is the next question?

Within the open countryside outside towns and villages there is an overriding presumption against development unless the special circumstances in para 55 dictate otherwise or the site is allocated in the Local Plan. This has always been the case, ever since the first true Town and Country Planning Act in 1947. Developments in the open countryside will seldom meet the tests of Sustainable Development outlined in paras 7 and 14 of the NPPF and as such one must always be looking to an allocation of land or one of the key special circumstances in Para 55.

It is very common for new property speculators to receive a refusal to the principle of the development of houses in the Countryside because they have not met one of the key tests or (moreover) they have attempted to site a large housing estate in the middle of nowhere.

The one happy exception to this comes in the form of Para 49 of the NPPF which states:

  1. Housing applications should be considered in the context of the presumption

in favour of sustainable development. Relevant policies for the supply of

housing should not be considered up-to-date if the local planning authority

cannot demonstrate a five-year supply of deliverable housing sites.

Here the Planning Inspectors and the High Court have been content to conclude that where a Council cannot demonstrate a 5 year supply then any land that is not otherwise protected (National Park, Area of Outstanding Natural Beauty, Site of Special Scientific Interest etc) could be fair game and assessed only on the principles of Sustainable Development.

There has, however, been a gradual finessing of what Para 49 means in practice and in reality farmers fields in the North York Moors are still far from Sustainable.  

Developers can check up on the status of the Council’s 5 year supply by downloading a copy of the Annual Monitoring Report (AMR). This should be produced yearly by council and will say succinctly how far ahead or behind they are.     

Getting Allocated

Larger developers do not leave things to chance. They have very large and expensive planning teams working with planning authorities to allocate sites in the next Local Plan. These are sites that are already secured in some way and are part of their land bank.

Getting allocated changes the policy rules from a presumption against to a presumption for the development because the Council themselves have concluded that they need the development in that location and there is a Policy Allocation to support it.

Getting allocated establishes the principle of development and also the level of development that will be acceptable on the site.

Smaller Developers can engage with the same process using the Strategic Housing Land Allocation Assessment (SHLAA) or encouraging a Parish to prepare a Neighbourhood Plan.

The SHLAA is one of the first stages of plan preparation and normally follows a ‘call for sites’ where landowners are encouraged to submit their site freely for assessment. Getting your site in the SHLAA (normally by filling out a simple form) starts the 5 year process of getting a site allocated within a Local Plan.

The Neighbourhood Planning Process, brought forward by the Localism Act, enables Parish’s, Villages, Towns and Neighbourhoods to engage with the Plan Making Process by preparing their own planning policy document. Again Smaller developers can engage with this by providing a housing site for consideration or even instigating the process. Again this is a five year wait but as said a Policy Allocation is worth it.

Special Circumstances

If your in a rush and can’t wait five years or so then you need to use one of the Special Circumstances outlined in Para 55 of the NPPF  

the essential need for a rural worker to live permanently at or near their

place of work in the countryside;

Again this has always been the case. Rural workers homes receive a condition or ‘Agricultural Tie’ limiting who can occupy them. There has to be an established agricultural business, you can’t just make one up, and the building must be built at or near their place of work (not in the middle of nowhere).

Buildings with an ‘Agricultural Tie’ can have this condition removed but only after a year of marketing at the market rate for an agricultural workers home.

There are some agricultural businesses that do not need workers so beware of (inter alia) Alpaca and Lama farms as the Courts have gotten wise to this. Alpaca’s and Lama’s live in the high Andes Mountains of South America and rarely come in to contact with or need humans for anything!     

where such development would represent the optimal viable use of a

heritage asset or would be appropriate enabling development to secure

the future of heritage assets;

In the open countryside owning a listed building, finally, makes sence! If your lucky to own a listed barn, hall or other structure and the Council’s Conservation Planner agrees with you that the best use for the building is to turn it into a house then you may use this very special circumstance as the duty to preserve a listed building outweighs the need to protect the countryside for its own sake.

It is important to remember that Listed Buildings are protected for their Special Architectural or Historic Interest so before you run off and buy that amazing Grade 2 Listed Abandoned Asylum in the Dorset Countryside (no hints) remember that you should make friends with the Conservation Planner and Heritage England who will helpfully guide you on what bits you need to keep.    

where the development would re-use redundant or disused buildings and

lead to an enhancement to the immediate setting

This circumstance follows the principle of wrong development in the wrong location. If your able to secure such a site the Council has a duty to secure an improvement to it.

This provision works best for old or redundant buildings that are an eyesore and where the use, if restarted, would be undesirable.  Importantly there must be previous development on the land.

In the main this focuses on builders yards, open storage, car wreckers and other more nasty businesses (yes all of the above do exist within the countryside) that are best suited to an industrial estate and not the verdant green of the Chilterns.  

Well designed housing on such sites is often considered preferable to the existing use and is supported using this special circumstance.  

the exceptional quality or innovative nature of the design of the dwelling.

Well you could always make them pretty! The high quality design circumstance applies the balanced argument that the design is so go it should be allowed in all other respects. To qualify the design you (or your architect) produces must:  

be truly outstanding or innovative, helping to raise standards of design more generally in rural areas;

reflect the highest standards in architecture;

significantly enhance its immediate setting; and

be sensitive to the defining characteristics of the local area.

These are very big targets to hit and developers are often limited to one or two houses. A bespoke estate of architectural brilliance is highly unlikely but I remain to be pleasantly proved wrong.

As you can tell the above will still take time and as such one must not rush into a Countryside Project, leave at least 12 months free to get this sorted and expect at least 1 resubmission or 1 trip to see Mr Inspector before you get approval.

Well there is always Permitted Development

Designed for the super busy and those who really need to be onsite Now! The Permitted Development Allowances for Commercial to Residential Conversions are a viable quick method of getting new dwellings in the Countryside.

They may not be used for Listed Buildings, Areas of Outstanding Natural Beauty, Conservation Areas, a site of special scientific interest, a safety hazard area, a military explosives storage area, a scheduled monument, National Park or World Heritage Site. You will note that I have not mentioned Greenbelt in that list.

Classes G, M, N, O, PA and Q of Part 3 of Schedule 2 of the General Permitted Development Order 2015 (As amended) are all available for the Developer to utilize with the correct Prior Notification Application and remain the most viable method of converting a building into a dwelling.

However, these are not for the uneducated so it is always best to speak to a planning consultant BEFORE you buy to make sure you can rely on the valuable PD allowance.  

In conclusion development in the countryside is not impossible however the pitfalls exist where the wrong strategy is used on the wrong site or where the developer does not have the time to wait for policy to catch up with their aspirations.

High quality development which seeks to resolve a problem, save a listed building or is just architecturally excellent will always be rewarded.

However before entering any development speak to your friendly neighbourhood planning consultant (the RTPI has an amazing list) to get you on the right track from the start.

Jonathan McDermott is a Chartered Town Planner, Principal Town Planner for Town Planning Expert and educator with Whitebox Property Solutions on Property Developers Secrets and Property Planning Masterclass.