The new permitted development rights allowing change of use from a light industrial building to a dwelling house came into force this October within Class (PD) of Part 3 of Schedule 2 of the General Permitted Development (England) Order 2015.
The Government hopes that by de-regulating this area, developers will be encouraged to convert underused commercial and industrial space into new homes. This latest change is part of the Government’s package of reforms to help ‘fix’ the broken housing market. There was certainly a huge uptake of the permitted change of use from office to residential introduced back in 2013 but the new right comes with an array of constraints which limit the number of buildings that will qualify:
- The building must have been used solely for light industrial purposes on or before 19 March 2014.
- The right is subject to a prior approval process, allowing local authorities to scrutinise the proposed development’s impact on transport, contamination, flooding and the provision of industrial services.
- The right is only temporary. Prior approval must be granted before 1 October 2020, developers then have three years to complete the change of use.
- There is also a size restriction. The new right only applies where the gross floor space of the building is 500 square metres or less, ruling out larger industrial buildings.
Therefore, what on the surface appears to be another significant change in the planning process is in reality unlikely to trigger a flurry of development. Much the same thing happened with the introduction of a permitted change from agricultural to residential use – the conditions imposed are so stringent that the refusal rate for prior approval is nearly twice as high as for other permitted development applications.
Moreover, with industrial land essential to support the employment market it is likely that local authorities will wish to protect buildings that are vital to their economy – this has already been seen with Islington employing an Article 4 direction (thereby ensuring such changes are subject to the usual planning application process) in order to safeguard its “central activities zone”.
It seems that through these limitations the Government hopes to protect new and larger industrial units, whilst still encouraging the conversion of older, smaller, un-listed industrial buildings. Yet, precisely because of these stringent requirements, it is unlikely that this latest change will have a significant impact on the housing market where shortage of supply remains an ever growing concern.
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Stamp Duty Land Tax: Mixed use property, claiming multiple dwellings relief, interaction with the 3% surcharge