Could retail-to-resi solve our town centre crisis?

Landlords and property investors could be handed a new opportunity in 2021 – to convert retail units to residential property more easily than ever before.

In a new consultation, Supporting housing delivery and public service infrastructure, published on 3 December, the Government is looking for views on whether to allow Class E property to change its use to residential. This would mean altering the general permitted development order to allow retail units to be converted into homes. The MHCLG proposals are being tagged as a way to breathe new life into high streets and town centres. Traditional retail is under the cosh and enabling developers to quickly and easily convert retail to much-needed new homes sounds positive.

inancial and professional services

As it stands, Class E is a broad use class and it doesn’t only cover retail. It also applies to hospitality, financial and professional services, indoor sport and recreation, medical or health services, crèche, nursery and day centres, offices, research and development and light industrial uses. So extending the use class to residential too would give landlords and investors scope to turn all kinds of buildings into homes. So far so good. However, the proposed changes not only apply to urban areas. The new permitted development right could be made applicable in a whole range of locations except in national parks, the Norfolk Broads, Areas of Outstanding National Beauty and World Heritage sites plus a number of other specially designated places. Conservation areas may be up for grabs too. Permitted development rights are by their nature ‘light touch’ so rapid planning approval could be given to convert all kinds of buildings to residential use in out-of town as well as urban locations. That wouldn’t do much to bring our deteriorating town centres back to life.

The other issue of course is that with bricks and mortar retail in decline, it is vital to ensure that the pendulum does not swing too far towards residential, leaving us with town centres dominated by housing. Local authorities must be given plenty of leeway to get the balance right. So we say yes to enabling retail–to–resi conversion – but it must be done right. We should be wary of giving investors and developers a free hand to create new housing in any under-utilised building they can acquire at the right price. This cannot be good for our communities. Surely it would be better to first consider other options for commercial space that could bring the vibrancy back to our town centres that is so sorely lacking in many parts of the country. By all means let’s find new ways to streamline planning policy but we must all be aware of the potential for unintended consequences.

To read the consultation and have your say click here.