Expansion to Permitted Development Rights

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Commercial Property Article

04 March, 2021

The Government has introduced from 31 August 2020 an expansion of the currently permitted development rights (PDRs) and this presents an opportunity for developers to broaden their residential development portfolio, without formal planning permission. This is particularly significant given the impact of the Covid-19 pandemic and how this has changed effective property use.

Re-emphasis on residential buildings

As a result of the pandemic, many businesses are looking again at their office usage. The demand for office space has decreased at least int eh short term and so there is now a new potential emphasis on pivoting the usage in residential properties.

From August 2020, developers are now permitted to demolish property built to house a block of flats - or detached buildings utilised for offices or industrial purposes - to be redeveloped into a detached block of flats or single home. The new PDRs now also enable developers to expand existing dwelling houses of two storeys up to a further two storeys, or one further storey to a current one storey property.

What is the approval process?

Even though it is not necessary to obtain formal planning permission from the Local Planning Authority - there is a requirement to obtain prior approval from the Local Planning Authority which cover how the proposed development will affect:

  • The impact that it will have on the amenity of existing adjoining properties, such as privacy and loss of light;
  • The external appearance of the proposed development;
  • Whether it affects factors such as air traffic.

Before commencing any works on any upwards developments, rebuilding PDRs and demolition work - prior approval must be granted by the Local Planning Authority. For other residential PDRs, works can commence on the basis that you have received prior approval, or, a minimum of 56 days of the application being filed to the Local Planning Authority without there being an outcome to your application. This will be a much faster process of having to obtain full planning permission.

There are also additional factors to keep in mind become commencing work on a PDR basis:

  • The works must be finished within three years the application is given prior approval; and
  • Any residential works commencing after approval from the Local Planning Authority from 6 April 2021 onwards must meet the space standards requirements.

What are some of the legal implications?

When looking at the future use of the new apartments above existing commercial or residential property, there are several other factors to consider concerning the legal arrangements and care that must be taken. As an example, there will of course be noise, dust and inconvenience in the new build and this may be a breach of any existing lease terms to any current downstairs tenants. Additionally if a developer plan to dispose of the Freehold to another developer or buyer as part of the development then this may breach any existing leaseholders rights of first refusal under the Landlord and Tenant Act 1984.

Finally, we may see a rise, when disposing of a property with potential for upward developments, of the sellers seeking a benefit of future work by way of an overage or "clawback" from the future uplift in value of the property.

For more information contact Matthew Jones in our Commercial Property department via email or phone on 01254 222316. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

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