Why adding more residential properties to towns will revitalise our High Streets

Why adding more residential properties to towns will revitalise our High Streets
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By Ritchie Clapson CEng MIStructE, co-founder of propertyCEO

Our retail landscape has changed. Essentially there are two reasons to go shopping: either you want to go, or you have to. Yet, with the rise of out-of-town retail and e-commerce, it seems unlikely that we’ll ever have to regularly shop in the high street again. It’s far more convenient to drive to a supermarket or order items online.

Without any need to shop in the high street, we need to create a place that shoppers want to visit. Town centres need to become leisure destinations. They need to house restaurants, pubs and cafes, boutiques and other specialist retailers, cinemas, theatres, and sports and music venues, as well as gift and craft stores.

Starting the transformation

There’s no magic wand in sight so how will this transformation happen?

People like living in towns with a vibrant high street on the doorstep. Achieving this transformation will mean repurposing existing buildings in our town centres to create the right balance of homes, workspaces, retail, leisure and services. But the starting point has to be residential. Because by creating attractive homes in town centres, the demand for these other shops and services follows automatically.

Historically, this residential development has been difficult due to strict planning regulations. To turn a derelict department store into apartments, for example, would require planning permission from the local planning authority (LPA) department, which are usually notoriously underfunded and overloaded.

The impact of Permitted Development Rights

But help is at hand. To speed the redevelopment process up, the government has created Permitted Development Rights (PDRs) which allow the use classes of certain types of building to change without the need for a full planning application. This makes the process much quicker and easier for developers to redevelop buildings as it reduces and sometimes removes altogether the risk of planning being refused.

In most cases, however, developers must still make an application, but the LPAs have far fewer criteria on which they can object and, in some cases, they have just 56 days to raise any objection.

Using the ‘Class G’ PDR, it’s possible to convert the floors above a shop to residential. Furthermore, ‘Class M’ PDR allows developers to convert the ground floor of shops up to 150m2 that are not deemed ‘prime retail’ into residential property.

In 2020, the government simplified the way buildings are classified by their use and lumped them into a new ‘super-category’ called Class E. This means that it’s easy to change a shop into say, an office, without explicit permission from the LPA.

But what new homes? The government has proposed that, from 1st August 2021, all buildings in Use Class E can be converted to residential using a brand new set of Permitted Development Rights. This is the final piece of the jigsaw puzzle which, if approved, will allow us to repurpose most of the buildings in our town centre without the need for planning permission.

The benefits of the new vision for the High Street

This new vision of the high street will deliver multiple benefits beyond rejuvenating our town centres. There is an acute housing shortage, and by turning existing unused buildings into homes, we’re not only creating new homes, but we’re also recycling our building stock and reducing the need to develop on green-belt land, thus helping preserve natural environments.

Currently, many developers gravitate to new build because they believe it will be easier to get permission and they don’t have to contend with the limitations presented by an existing building and a town centre location. By making it easier and less risky to develop brownfield sites, converting existing buildings becomes much more attractive.

The new-look high street will also encourage property investors to invest in town centre premises once more.

These new more vibrant communities will also help drive a reduction in crime, and remove the risk of town centres becoming ghettos. Instead, they will be places that appeal to all sectors of society: young and old, families, couples and singletons.

And, of course, it ensures that a new type of retail can continue, without threat from e-commerce and out-of-town shopping centres.

Potential drawbacks of redevelopment

One of the biggest historical objections to using PDRs to redevelop retail spaces into residential properties is rogue developers creating tiny, cramped flats with little natural light. However, the government has declared that, from 6th April 2021, all PDR applications must conform with National Space Standards, which sets minimum requirements on home sizes and quality.

A more stubborn, issue could be the absence of a firm plan to deliver the right balance of housing, retail, and office space in each individual town. While PDRs makes repurposing buildings easier, we don’t want our town centres to be turned into housing estates.

One potential way around this issue may be for local planning authorities (LPAs) to override PDRs entirely by using Article 4 directions. By issuing such a direction, they could require that any town centre development must have full planning permission. Unfortunately, however, this would simply bring us back to where we were before, with little incentive for developers to bother with town-centre regeneration. The baby effectively gets thrown out with the bathwater.

Instead, there needs to be some joined-up thinking between the government and LPAs that ensures the vision is realised. It will necessarily require LPAs to relinquish a level of control by embracing the new PDRs, but also to create both a vision and a framework that allows for regeneration to deliver the sort of town centre that works for everyone. The key is to take a step back and focus on the bigger picture, then plot a path to achieving it. Compromise will undoubtedly need to play its part.

One final hurdle is that LPAs do not keep an updated register of brownfield sites, so the scale of the development opportunity is not known and can be hard to ascertain. According to a January 2021 report by specialist regeneration developer U+I, poor brownfield land registers ‘hinder the development of new homes’. LPAs have been obliged to maintain such a register since April 2017, but it would appear they are far from up to date.

The rise of the indie developer

One of the most interesting aspects of town centre redevelopment is that it will have to be led by small indie developers. For large housebuilders, converting individual retail and office units into residential property is too small scale to interest them.

Instead, we will see the rise of the indie developer. In 2020, there was a huge surge in interest from people from all walks of life interested in small-scale property development, attracted by the opportunity to create six-figure profits from relatively small development projects.

Property development isn’t easy or without risk. But, while it may be the first time these indie developers have taken on a redevelopment project, they will be mostly employing a team of local professionals to do much of the heavy lifting with a Project Manager overseeing things on their behalf.

As the opportunities converge we are likely to see many more small-scale developers take advantage in 2021 and beyond, helping to build a diverse and interesting high street attracting a wide range of people.

 

Why adding more residential properties to towns will revitalise our High Streets

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