Mike Derbyshire, Head of Planning at Bidwells, was among the key speakers at this year's National Planning Summit in London on Thursday 21st April, where he tackled the issue of Permitted Development Rights for conversions to housing.
The Summit, which is now in its third year and organised by the Planning magazine, aimed to address the biggest challenges facing the planning system today and debate how true growth can be delivered in a changing policy landscape.
It brought together around 150 senior public and private sector planning professionals who heard presentations from key speakers including Planning Minister Brandon Lewis and the chief executive the National Infrastructure Commission (NIC) Phil Graham.
Mike, along with Alice Lester, manager for Planning Advisory Service, headed-up a presentation looking at the issues regarding permitted development rights for conversions to housing.
He told the packed summit, that changes had originally been introduced in May 2013 for a three-year period – and Eric Pickles, had promised they would unshackle developers from a legacy of bureaucratic planning by helping them turn thousands of vacant commercial properties into enough new homes to jump start housing supply.
Mike said: "The intention was that the conversion of vacant low grade office space would lead to the creation of more dwellings in buildings that were no longer fit for purpose as commercial offices.”
Originally, changes to the General Permitted Developer Order (GPDO), were introduced on 30 May 2013 for a three year period and many felt it was, at the time, a tonic for the recession.
But new regulatory changes came into force on 6 April this year and this included making the temporary permitted developments rights allowing office to residential conversions without having to apply for planning permission, permanent.
There are still lots of unanswered questions for councils and developers as to what the future with Permitted Developments will hold
Mike Derbyshire, Partner, Head of Planning
As with the existing process, a Prior Approval application will have to be submitted for such a change of use. A new condition has also been included allowing local planning authorities to consider noise impact on the intended occupants from nearby premises in commercial use.
Mike added: "It was speculated that a consideration would be introduced on the impact of the loss of more strategically important office accommodation within the local areas. This didn't happen."
Some 165 Local Planning Authorities asked to opt out of permitted development (PD) - but only 17 were ever granted exemption.
Greater London has been particularly impacted by PD; this is thought to essentially being down to the significant difference between office and residential values, combined with high demand and land scarcities. This provides a strong incentive to seek conversion, even if it is occupied space.
The impact has been that 11 boroughs in London have reported at least fully-occupied office spaces being approved for conversion. Barnet has seen the most of all with 40 occupied units being approved for conversion.
According to London councils, some have reported that PD rights have had an impact on land values for scarce office stock, threatening the viability of office redevelopment/refurbishment even when there is a clear demand.
And the London councils say approval has been granted for at least 100,000 sqm of wholly occupied office floor space (May 2013-April 2015) and 834,000sqm of total office floor space.
In Surrey, anecdotally businesses, such as office cleaners, stationers, florists, taxi firms, caterers and those in the hospitality sector all report loss of revenue as nearby buildings are converted.
From a developer's perspective they welcome the new freedoms and the most recent changes and this has removed the rush to ensure completion by 2016. It also means it could open up high value central locations.
But the impact on local authorities is firstly hitting their resources, with a high volume of applications at only £80 a go, a loss of business rates, impact on affordable housing provision, loss of occupied offices, loss of good quality office space and impact on employment strategy.
Mike concluded: "There are still lots of unanswered questions for councils and developers as to what the future with Permitted Developments will hold, the previous changes were subject of much contention in London but, have settled down as appeal decisions have clarified the proper interpretation of the regulations, but I fully anticipate similar conflict with the new regime in the early years until clarification has been made by the courts or the Planning Inspectorate.
"Will it start to impact on places outside of London, what will happen to the 'demolish and rebuild' proposal, will there be a proliferation of Article 4 directions, and will we survive without as many launderettes?