Covid has changed the way we work. Hundreds of companies are discovering that the service they provide can be done by employees working from home, and in many cases, it’s been found to be far more financially viable to have a team that telecommutes and uses Zoom for meetings, rather than having a bricks-and-mortar office.
That means the business property landscape is changing radically, and many commercial properties are no longer needed. More businesses are going online, and workplaces are either utilising pop-up office space or going remote. Sadly, companies are also going out of business.
The government has recently confirmed the new permitted development regulations that mean properties can be changed from Use Class E (commercial, business and service use such as cafés, shops and offices) to Use Class C3 (residential use). This is being called Class MA and is applicable from 1st August 2021. The PDR or Permitted Development Right does, though, have some big ‘buts’ attached to it.
Before you start…
This change of regulations doesn’t represent a ‘free for all’ when it comes to change of use – there are still some hoops that you’ll need to jump through to make it official, as well as some caveats that could block your application in its tracks.
Applications still need to be made to the local planning authority (and of course, that means they have the right to say no). Rejections could be for a number of reasons, from adequate lighting and ventilation in habitable rooms through to contamination (for example, if the property was previously a commercial garage and may have contaminated ground that needs to be cleaned up first).
Another thing that could stop a change-of-use stampede in its tracks is the amount of time a building has to remain vacant before a change of use is considered, or was used for its previous Class E purpose.
If a building has been used within three months prior to the date of application for change of use, or was used for its previous Class E purpose for less than two years, then you won’t get approval for a change of use.
The impact on the local area as a result of a change of use will also have a bearing on whether you get permission from your local authority or not. For example, if your building is in an Area of Outstanding Natural Beauty, a national park, or an SSSI site then your application will be looked at very carefully for any potential impact on the environment.
The building being converted must have a total floor space of less than 1500 square metres. Anything larger than that and you’ll need to apply for planning permission in the usual way.
Bear in mind, too, that even if your property ticks all the right boxes for the PDR to apply then you’ll still need to apply to your local authority, and pay the £100 per dwelling fee (up to a maximum of £500).
Why is the government doing this?
There’s currently a big push to convert empty commercial spaces into homes to fill the ever-increasing demands on the domestic property market. It’s also a measure to try and revive the fortunes of the high street, which may be changed forever after Covid and the collapse of the retail sector.
The government hopes that the greater degree of flexibility in converting unused commercial space into domestic dwellings will also inject a boost into the construction industry on all levels, as well as increasing the amount of accessible and affordable housing.
If you have a commercial property that previously fell into Class E (the old Class A1/2/3 and B1) and want to convert it to domestic dwellings, you’ll need to check that it meets all the requirements as laid down by the new regulations. Remember that you’ll also still have to apply to your local authority before you swap those cash registers for sofas and soft furnishings, and they could still decline your application on a number of different grounds.
As always, when undertaking this kind of process, it’s advisable to talk to a legal expert who specialises in property law. Get them to look at your plans, and make sure that your change of use application isn’t going to fall at the first hurdle.