How to ‘level up’ between development types and extend the flexibility that Class E gave to some sectors – Property Reporter

Lewis Taylor 933

In July 2020, partly in response to Covid-19 and its impact on the high street, the Government introduced a new Planning Use Class, Class E.

This new use class encompasses commercial, business and service sectors and has brought about the repurposing of buildings on high streets and town centres. It responds to the shift in retail requirements while also enabling a building to be used more flexibly: a wide range of uses can take place concurrently or at different times of the day and night – all without the need for planning consent.

When, six months later, the Government allowed change of use from Class E to residential under Permitted Development Rights (Class MA), the properties which fell into this category – shops, financial and professional facilities, restaurants and cafes, parts of the old D1 non-residential institutions and assembly and leisure buildings – were all given considerably greater flexibility. However, this is subject to a number of criteria, including having been vacant for at least 3 months, having been in a Class E use for a continuous period of at least 2 years, the cumulative floor space of the existing building not exceeding 1,500sqm, as well as other conditions relating to designations and listed buildings and Article 4 restrictions.

The use classes which are outside Class E, on the other hand, remain constrained by the Planning Use Classes system, sometimes to their considerable disadvantage.

Perhaps that hardest hit is Class C2 (institution/care homes) and C3 (residential dwellings) which jointly are the primary means of providing homes and facilities for the elderly. There is no question that change is also impacting this sector: the number of over 65s in the UK is 12 million, and the Office for National Statistics predicts that this will rise to 15 million by 2030. This significant increase will require a significant change in the delivery of specialist housing.

Unfortunately, the planning system creates a number of challenges that stand in the way of planning consents, growth and investment for this sector.

The restraints of the rigid Planning Use Classes structure is compounded by some uncertainty over whether more innovative retirement housing falls within use class C2 or C3. The debate centres on whether C2 is appropriate for a traditional residential care home, in which residents benefit from facilities provided communally; or whether Extra Care Housing, whereby residents have self-contained accommodation combined with communal facilities and the availability of personal care, necessitates a C3 use class.

The confusion created through the rigidity of Use Classes causes difficulties in relation to the provision of affordable housing and Community Infrastructure Levy which in some cases is reduced because of it. Greater clarity would bring about significant and wider benefits.

Just as Class E was seen as having the potential to address the high street decline, so too could later living accommodation.

High Streets across the country have struggled as they fail to compete with online retailers, large out-of-town retail parks and shopping centres. Where the rigid use class structure still exists, it is difficult for landlords to find occupants for vacant premises. In many cases later living schemes could have literally filled a gap on the high street – providing a good secure tenancy while also helping to keep high streets lively and occupied. Traditionally, retirement villages are gated communities in the countryside and on the fringe of towns.

More recently, however, developers have acquired vacant retail and office sites within urban areas with the intention of providing apartments for the over-65s, many of whom want to be closer to a lively city. Demand for this type of retirement housing soared during the Covid crisis.

When Churchill Retirement Living proposed 39 retirement flats on the high street in Calne, the proposal was twice knocked back by Wiltshire Council but then approved following an appeal to the Planning Inspectorate.

So considering that planning remains the most significant restriction to providing the housing that is so much needed for the older generation, a review of the relevant Planning Use Classes is long overdue. Disappointingly, there was no mention of later living or retirement homes in the recent Levelling Up White Paper.

Our hopes lie with the imminent Planning Bill and associated legislation. Ultimate flexibility is not necessarily the answer, as developments of this nature have very different business models to traditional housing schemes and it is essential that they be recognised within a specific ‘retirement communities’ planning use-class, or for planning practice guidance to define ‘housing-with-care’.

But increased flexibility would be welcomed by many. It would open up new locations to providers; while also better reflecting demographic diversity on high streets and in town centres; provide leniency for businesses to adapt and diversify to meet changing demands, and give our town centres an opportunity to recover from the economic impact of COVID-19.

Furthermore, with reports of isolation growing following the pandemic, many of the retired generations are now seeking out sociable communities within close proximity of a town or city centre. Later living schemes that are surrounded by the hustle and bustle of town life offers the opportunity to take advantage of shops, restaurants and other cultural activities present on the high street.