The Government has announced that new legislation will come into force in Spring 2013 allowing a change of property use from office to residential without the need to apply for planning permission.

Developers and land owners will find particular interest in the change, in a move the Government hopes will provide additional housing where there is a shortage.

It is intended to encourage economic growth by providing quick and flexible planning responses and to create opportunities for new and start-up businesses.

In April 2011 the Government consulted on a proposal on granting permitted development rights to change use of buildings from commercial to residential use.

The responses were published in July 2012, with the Government announcing two months later that these permitted development rights would be introduced to better enable such a change of use.

The Government has now written to chief planning officers at local authorities in England to alert them of the legislation coming into force.

Change

The General Permitted Development Order, which grants permitted development rights, will be amended to authorise the change of use without the need to apply for planning permission.

The new legislation will initially apply for a period of three years, but the Government will consider towards the end of that period whether the new rights should be extended indefinitely.

Constraints

The permitted change will be subject to a tightly drawn prior approval process. This is not the same as lodging a full planning application as it will only relate to:

- Significant transport and highway impacts; and

- Development in safety hazard zones, areas of high flood risk and land contamination.

Whilst only the limited prior approval will be needed for the change of use, a full planning application will be needed for any external works that are required to facilitate the change of use, including:

- Works that materially affect the external appearance of a building; and

- Other external building, engineering or other works.

Local Authorities

They will have to act reasonably in dealing with both the prior approval applications and planning applications for external works. In addition, they will be required not use the processes in a manner that in effect seeks to object to the principle of the change from office to residential use, otherwise the Authority’s decision could be overturned on appeal by the Secretary of State or a planning inspector.

Exemption

Local Authorities are able to write to the Government to seek an exemption for specific parts of their localities where there are exceptional circumstances. These will mainly be when the introduction of rights will lead to either a loss of a nationally significant area of economic activity or when it will lead to substantial adverse economic consequences which are not offset by the positive changes.

The new rights will not apply to the City of London. This is after significant concerns and lobbying by the Corporation of London in recognition of its status as the leading financial and business district in the UK and Europe. A significant number of other authorities are thought to follow suit, but many will be refused.

Exemption requests must be submitted by 22nd February 2013 to be considered. A list of the exempted areas will be published in Spring 2013.

Next Steps

The Government’s intention is that this new scheme will make the best use of developed sites by allowing existing buildings to be quickly brought back into productive use, without the hindrance of the perceived cost of the planning system.

However, there is scepticism surrounding the measures as available office space may decrease, giving rise to increased rental prices. Office tenants may also be in a less secure position as owners will come up against fewer obstacles when changing their premises to residential use without restriction.