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Can new planning rule changes save the High Street? And what are the business opportunities?

WORDS: RITCHIE CLAPSON AT THE TURN of the 21st century, online retail arrived and removed the need for people to visit bricks-and-mortar shops. The likes of Amazon have changed the way we shop forever and there is no going back. We can now buy almost anything we want without leaving the house.

This increase in online retailing means that we’re left with are redundant retail hubs in our town centres that now need to be repurposed.

According to estate agents Savills, around 12.5 per cent of retail premises in the UK are vacant, with 40 per cent of empty stores lying vacant for three years or more. They predict that retail vacancy will rise to 25 per cent by the end of the decade unless action is taken.

Yet, even though the majority of high street retail units are occupied, many now house charity shops, vape stores, and the like – far from the bustling retail hubs that our high streets once were.

How can we prevent further high street decline and what business opportunities will this change create?

To return to thriving hubs of activity, town centres need to become leisure destinations. They need restaurants, pubs and cafes, boutiques and other specialist retailers, cinemas, theatres, sports and music venues, gift and craft stores.

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aOxford Street, London

W1: thriving in normal times but such streets need to rethink their role going forward into the future

It will be down to small independent retailers serving up a huge range of products to create a browsers’ paradise where people want to go for a day out or an evening’s dining or entertainment.

And the secret to achieving this revitalisation of commerce? To make town centres more residential. People like living in towns that have a vibrant high street on the doorstep. So, the more residential property there is, the more independent retail there is, encouraging more residential, and so on. This could create a virtuous cycle that leads to the wider regeneration of the high street.

How do we achieve this transformation? We need to repurpose the existing buildings in our town centres to create the right balance of homes, workspaces, retail, leisure and services operating side-by-side. But the starting point has to be residential.

Historically, this residential development has been difficult due to strict planning regulations. However, to speed up the redevelopment process, 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.

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 in which 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.

Also in 2020, the government simplified the way buildings are classified by their use. Where previously, shops, offices, light industrial buildings, financial and professional services businesses, cafés or restaurants, clinics, health centres, day nurseries, and gyms each had their own individual use-classes, they are now lumped into one singleuse class: ‘Use Class E’. This means that it’s easy to change a shop into, say, a gym without explicit permission from the LPA.

But what about new homes? In

December, the government proposed that, from August 1, all buildings in Use Class E can be converted to residential using a new set of Permitted Development Rights. If approved, this will allow us to repurpose most buildings in our town centre without the need for planning permission.

To avoid our town centres becoming housing estates, 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 recent 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.

“We need to repurpose the existing buildings in our town centres to create the right balance of homes, workspaces, retail, leisure and services operating side-by-side.”

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 who can take on one or two redevelopment projects at a time, creating unique, high-quality housing. These small scale developers could be anyone looking to work on projects in their spare time, or create their own business.

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 sixfigure 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.

And, with so many opportunities converging at one time, 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 with a range of thriving businesses. n Ritchie Clapson CEng MIStructE is co-founder of propertyCEO