New Permitted Development Rights for Use Class E to Residential

The highly anticipated permitted development right ("PDR") from the new use class E to residential use has now been introduced.  From 1 August 2021, a new PDR – 'Class MA' will allow a change of use from use class E (commercial, business and service) to use class C3 (residential use) without the need to submit a formal planning application.  Class MA will replace all existing office, retail and light industrial PDR to residential.

The process

To benefit from the PDR, an application for prior approval consent must be made to the local planning authority and not before 1 August 2021.  Class MA has introduced new requirements not previously seen in the PDR for office to residential.  Any application will need to consider:

• The impact of the loss of health centres and registered nurseries where the application concerns the loss of such uses. This is a key change which recognises the value of nurseries and health centres on local communities.   However, no such requirement exists for the impact of the loss of retail units. 
• If the proposal concerns a change of use of part or whole of a ground floor in a conservation area then an assessment on the impact of that change on the character or sustainability of the conservation area will need to be undertaken and submitted with the application.
• The impact on intended occupiers of the development of the residential use in an area the Council considers to be important for general or heavy industry, waste management, storage and distribution or a mix of such uses.

Restrictions

The potentially far reaching scope of Class MA is limited due to the following additional restrictions which have been introduced:

• The building must not be more than 1500 square metres;
• The building must have been vacant for at least three continuous months before the date of application for prior approval consent (periods of closure as a result of Covid-19 restrictions will not count towards this period where the building continues to be occupied);
• The building must fall within use class E, or one or more of the uses that it replaced for a minimum of two years before the application for prior approval.

Salient points

When considering exercising these new rights, please be aware of the following:

• Local authorities will still be able to condition any prior approval consents on limited grounds such as transport impacts of the development, environmental contamination risk, flooding risks, noise impacts, the provision of adequate natural light in the habitable rooms and the impact on intended occupiers of the development.
• The development must be completed within a period of three years starting with the prior approval date.
• Pre-existing article 4 Directions for office to residential development will automatically be transferred to include Class MA until 1 August 2022 unless cancelled.  Local searches should therefore be checked to ensure that there is no applicable Article 4 Direction.
• Section 106 Agreements can still be used to offset any issues raised in the prior approval process such as transport, environmental, flooding but will still not attract any requirement to provide affordable housing.

Some new issues are raised by Class MA which clients should consider now:

• Most change of use developments for PDR benefit from the "in use" rule for CIL i.e. no CIL is payable where it can be proven that the building has been "in use" for a continuous period of six months in the three years preceding the decision notice.  We may see some tension between this requirement and the Class MA requirement for the building to be vacant for three months before the date of the application for prior approval consent. Make sure that you can provide evidence that the building has been "in use" for six months within the three-year window.
• If you have a large office (more than 1500 square metres) that you are intending to convert using existing PDR, you will have to apply for prior approval consent before 1 August 2021.

The future of Class MA

Class MA is clearly an attempt by the Government to placate both supporters and objectors but without fully satisfying either side. Supporters believe that the restrictions will limit the opportunity the Government could have given to landowners to deliver much needed housing.   Objectors do not believe that the restrictions go far enough to prevent unsuitable housing being brought forward without even the benefit of much needed affordable housing being delivered.  We would love to hear from our clients as to whether you will be using these new rights. Please do get in touch and let us know.