Commercial Property. The new housing minister Robert Jenrick made an announcement last September that they would help the creation of much needed homes whilst giving the high street a new lease of life by removing eye sores and transforming unused buildings and making the most of brand field land. The package includes a new fast track system for extending public buildings. New rules allow for bigger extensions to exist in public buildings including schools, universities, colleges and hospitals. This will help deliver more classrooms and hospital space by enabling them to extend further and faster, as we emerge from the pandemic.
It also included allowing unused commercial buildings to be changed in to homes. This will encourage more people to live near local high streets and come to the area for work and leisure. This helps them cement the high streets and town centres into their rightful place in the heart of the community.
The new homes will be delivered through a new simpler prior approval process instead of full planning applications. It will still be subject to high standards, ensuring they provide adequate natural light and meet space standards.
The government believes that there is an opportunity to contribute to increasing the housing supply by recognising the scope for allowing change of use of buildings from commercial to residential to take place more easily.
They recognise that there are buildings which no longer function as they were intended to be. These are offices built in locations where the demand for office space has moved on. The need for buildings with high specifications that can deliver a more modern style business. Similarly, there are industrial buildings that are no longer suitable for manufacturing which will struggle to find a use which is a good opportunity for conversion.
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There have also been changes to the classes of planning use for shops, restaurants etc these have now been simplified in two various certain uses and classes so that anyone can do a change of use without requiring a permission.
The new classes are as follows;
The core changes include the removal of classes A, part of B and all of D with new use classes introduced in their place.
Class E (Commercial, business and service)
This will amalgamate a previous used classes A1 (shops), A2 (Financial and professional services), A3 (Cafes and restaurants), D1 (Medical facilities and nurseries), D2 (Indoor sports/fitness) and B1 (Office, business, light and industrial uses)
Learning and non-residential institutions including non-residential education use and use as a museum, art gallery, library, public hall, religious institution or law courts.
Local community, including use of a shop of no more than 280 square meters selling essential goods, including food and at least one CM from another similar shop. Use as community hall, area for outdoor spot, swimming pool or skating rink.
Can any unused commercial property be redeveloped?
The building changing use has to have been vacant for at least a minimum of 3 months before any application is lodge. This is in order to protect successful businesses in premises. Existing buildings will have to be 1500 square meters or under. This is for them to be able to carry out the conversion.
Why may homes on or near the high street be welcomed?
Retails with physical stores have long faced well documented headaches from business rates to growing competition from online firms. This was even before the Coronavirus crisis.
The high street is expected to have a huge amount of empty properties. This can be seen such as companies like Topshop, Debenham’s and John Lewis. Starting to go more online than using normal shops. Where landlords cannot find replacement relet tailors to open stores or leisure operators to take over they can turn empty sites into flats so this can be seen as an alternative.
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There are also other qualifications.
In order to qualify for permitted development right for commercial premises some commercial business and service use (within the new class E) must have been like this for at least 2 years.
There will also be some exceptions. It is intended to take effect from the 1st August 2021. Existing article 4 directions preventing changes of use from office to residential will continue to have effect until the 31st July 2022.
Prior approval will be required from local planning authority on the matter of flooding, noise impact, provision of adequate natural light or habitable rooms. Also where relevant the impact of loss of health centres and registered nurseries on a provision of such local services. In conservation areas local planning authority will also be required to consider the impact of loss of ground floor commercial, business and service use. Any homes approved will need to meet the nation space standards.
It is assumed that the new right will extend to apply to all high streets covered by class E. Although that will become more clear once the legalisation is available.
Other measures forming part of the package to boost the high streets recovery include;
A new fast track for extending public service buildings including schools, colleges, universities and hospitals.
Relaxation of planning rules to allow pubs and restaurants to operate as takeaways.
Longer opening hours for retail to provide flexibility and reduce pressure on transport.
Extensions to provisions of temporary pavement licences.
If you therefore have commercial property you should seriously consider whether the rules allow you to change it to residential. Is it worthwhile for you?
Will commercial property be worth more money in future because there is less of it? Will there be a market for it? These are all questions that only the future will tell us.
Have a occupied commercial property want insurance? Contact us on 01273 827090. Have residential buy to let, blocks of flats, houses to let and any other properties that require landlords insurance then contact us for a quote.