Living above the shop? New permitted development right

People may be familiar with the permitted development right to change office and light industrial units to residential. Effective as of 1 August 2021, this will be replaced by a new Class MA (Town and Country Planning (General Permitted Development) Order 2015) which will grant permission to change floorspace falling within Use Class E (an omni-class for Commercial, Business and Service uses which came into effect in September 2020 – see below) to residential floorspace (Use Class C3).

To qualify for this permitted development right, the floorspace:

1. Must have been vacant for a continuous period of 3 months immediately before the date of the prior approval application.
2. Must have been used for a use within Class E (or the relevant previous use class) for a continuous period of two years before the date of the application.
3. The cumulative amount of change of use floorspace must not exceed 1,500sqm.
4. Must not be within a listed building or its curtilage, form part of a scheduled ancient monument (or within the curtilage of such a monument), or form part of an SSSI, safety hazard area or military explosives area.
5. Must not be located within an AONB, the Broads, a National Park or a World Heritage Site.
6. The proposed residential floorspace must meet the Government’s nationally described space standards.

The new right is subject to the prior approval application process, which requires the applicant to secure the prior approval of the local planning authority to the following key issues:

1. Transport impacts (safe site access);
2. Contamination risks;
3. Flood risks;
4. Noise impacts from commercial premises on the intended occupants;
5. In a conservation area and where the whole or part of the ground floor is proposed to change use, of the impact of the proposal on the character or sustainability of the conservation area;
6. The adequacy of natural light to the proposed habitable rooms;
7. In areas that the local authority considers important for general or heavy industry, waste management, storage and distribution or a mix of those uses, the impact of introducing a residential use on the intended occupiers of the development;
8. Where the development involves the loss of a registered nursery or health centre, the impact of that loss on the local provision.

Before 1 August 2022 the deemed permission does not apply to proposed office to residential changes of use that would have been prohibited by an Article 4 Direction that was in force immediately before 1 August 2021. After 1 August 2022, the Article 4 Direction will be of no effect.

As regards Article 4 Directions more generally, to reduce the likelihood that local authorities will counter the new right with blanket Article 4 directions, the Government has announced its intention to tighten up NPPF policy on making Article 4 directions, requiring them to be limited to “the smallest geographical area possible” and the use of such directions in respect of residential permitted development rights will in future be limited “to situations where [it] is essential to avoid wholly unacceptable adverse impacts”.  The revised NPPF should be formally published later this year.

As for Use Class E (Town and Country Planning (Use Classes) Order 1987), this came into effect on 1 September 2020 and in summary, collects together into a single use class the following uses (the old use classes are in brackets):

1. Shops selling goods other than hot food (A1);
2. Restaurants and cafes (A3);
3. Financial and professional services (A2);
4. Gyms etc (excluding swimming pools or skating rinks) (D2)
5. Clinics and health centres (D1)
6. Creches, day nurseries or day centres (etc) (D1)
7. Offices, R&D and Industrial processes which can be carried out in a residential area without detriment to the residential amenity (B1).

NB: while most of the uses within the old classes A1, A2, A3, B1, D1 and D2 have been moved to Class E, some have been moved to a different class or become Sui Generis. For example, small shops (i.e. with an area of less than 280sqm, selling mostly essential goods and where there is no other such facility within a radius of 1000m) have been moved to a new Class F2, while pubs and hot food take aways are now classed as ‘Sui Generis’.  Landowners and leaseholders should check the precise terms of the Use Classes Order before making any changes.

The significance of Class E (and of the Use Classes Order) is that no planning permission is required to change from one use to another within the same class. That should make it easier and quicker to re-let vacant town centre premises. It also means that redundant premises within business parks can be repurposed more easily, e.g. we may see more out-of-date light industrial units changing to retail floorspace (and will certainly see more fall-back arguments in support of planning applications to redevelop sites).  However, a word of caution, if the planning permission for the relevant building contains conditions prohibiting any or the intended change of use, a new planning permission will still be required.

These innovations are part of the government’s response to changes to the high street retailing environment and to the housing crisis. In most cases, they should not have a major adverse impact on the character of prime retail areas in town centres. However, over the coming years, the character of secondary commercial areas is likely to change.  It remains to be seen how well that change can be managed.