Levitt Bernstein has launched an online petition to end permitted development rights for office-to-residential conversions. Julia Park explains why this “dangerous policy” has to go, in this excerpt from her report
The idea of using permitted development rights (PDRs) to convert offices (Use Class B1(a)) to residential buildings (C3), first emerged in the March 2011 Budget statement, soon after the Conservative-led coalition government came to power.
It was included in the 2012 National Planning Policy Framework (NPPF) and rolled out for a three-year trial period beginning in May 2013. Just before the trial period ended in April 2016, it was made a permanent right.
The press release published by the Department for Communities and Local Government (now the Ministry of Housing, Communities and Local Government) described it as “an opportunity for office owners and developers to bring outdated and underused buildings back to life”.
Notwithstanding the fact that it has always been possible to convert offices to residential, evidence shows that removing the requirement for planning approval led to an immediate and dramatic surge in this type of change of use.
The first year of PDR legislation generated 2,274% more office-to-residential conversions than the prior yearly average. The highest annual number of planning applications for office-to-residential conversions in the 10 years before the introduction of PDR was 900 applications in 2006. In 2014, 6,500 PDR schemes were notified.
The government’s impact assessment, published in 2013, “expected that there would be 140 applications per year across England”. In reality, 10,166 applications were received between 2014 and 2017
Following the introduction of PDR, it accounted for approximately 75% of all conversions in inner London in 2014. In the London Borough of Islington, one year’s worth of PDR notifications exceeded the total number of applications made during the 10 years prior.
By 2015, PDR accounted for more than 20% of housing starts in London. During 2013-15, three times as many homes were created through PDR in the London Borough of Croydon as the combined total of the three boroughs with the next highest totals. In 2015-16, approval for 12,824 homes through PDR represented 42% of all dwellings secured through change of use in general, and 6.5% of the total net dwellings that year.
The Royal Institution of Chartered Surveyors (RICS) has shown that the government’s impact assessment, published in 2013, was fundamentally flawed. It stated that “it was difficult to predict the number of additional housing units that might result from PD, but it was expected that there would be 140 applications per year across England”.
In reality, 10,166 applications for ‘prior approval’ were received in England between 2014 and 2017.
The government also considered that “it was unlikely the PD would result in housing built in unsustainable locations, such as industrial sites, as these would not prove attractive to housing developers”.
Before developers can convert offices to residential use through PDR, they are required to notify the local planning authority of their intention. In many instances, the authority will require prior approval, but for this type of change of use, prior approval can only be refused for reasons of flooding, contamination, highways and transport issues, and impacts of noise from commercial premises. A fee must be paid and development must be completed within three years.
Bypassing the normal planning system means bypassing many of the standards that exist to protect housing quality. These provide vital safeguards. In the sample of cases in Leeds examined by RICS, only 1% of the new homes created under PDR had any access to private or communal amenity space. In Leicester, there were none.
In a large proportion of conversions, the internal layout comprises a long, central corridor with flats on both sides. With an institutional feel and little, or no, natural light, this arrangement is considered the option of last resort for housing for very good reason. It also means that the vast majority of apartments will be single aspect. Facing north means no sun; facing west or south makes summer overheating almost inevitable without energy-guzzling air conditioning.
In Leeds, only 1% of the new homes created under PDR had any access to private or communal amenity space. In Leicester, there were none
The most obvious, and possibly the most worrying, deficiency of office-to-residential conversions is that they often comprise very small flats. A total of 77% of the homes in the case studies evaluated by RICS were studios or one-bedroom apartments. The government’s own Nationally Described Space Standard requires a minimum internal floor area of 37m2 for a single-person studio or apartment.
PDR has produced a significant number of studios of 13m2 – a third of the government’s own recommendation. One in Purley, is only 8.3m2; the size of a child’s bedroom.
The Nationally Described Space Standard took three years to enact and received an 80% ‘yes vote’ at public consultation. To accept that half, or even a third, of the recommended minimum space will do, without debate or evidence regarding its impact on mental health and well-being feels reckless and short-sighted.
Living in a space the size of a typical hotel bedroom will inevitably put strain on even a single person, but we know that a growing number of PDR conversions are occupied by couples; others by families.
In reality, many of these homes have multiple drawbacks; this is hardly surprising in buildings that were designed in a different era and for a completely different purpose.
To accept that half, or even a third, of the recommended minimum space will do, without debate or evidence regarding its impact on mental health and well-being feels reckless and short-sighted
The inability of local authorities to require affordable housing contributions for PDR schemes has been another carrot to developers, but another unacceptable consequence. A total of 4,000 affordable homes are believed to have been lost (ie not built) in the first two years after introduction of PDR and Shelter estimates that at least 10,000 affordable homes have now been lost altogether.
There has also been a loss of revenue to local councils. Technically, PDR conversions are liable for Community Infrastructure Levy (CIL) contributions. In practice, this rarely happens. In just the five local authority areas investigated by the RICS, £10.8m was assessed to have been lost in CIL contributions, and a further £4.1m lost to local planning authorities in planning fees that would have been payable had these developments been subject to the normal planning process.
Despite the poor quality of so many of these schemes, the flats and studios are often expensive to buy or rent. Savills estimate that 58% of current demand is for homes that cost less than £450/sq ft; many PDR flats cost more than £1,000/sq ft.
Some developers appear to be deliberately targeting vulnerable tenants; in some cases dealing directly with councils to reduce housing waiting lists
In the first few years of PDR, when no one could be sure whether the trial period would be extended, many developers bagged a quick bargain. The value of older office buildings increased rapidly and, now that it has been made permanent, even the most run-down are now extremely valuable in those areas where Article 4 Directions have not been successfully invoked. When 15-17 Grange Mills was marketed last year, offers in excess of £2.5m were sought.
At the lowest end of the market, some developers appear to be deliberately targeting vulnerable tenants; in some cases dealing directly with councils to reduce housing waiting lists. This often means that they are able to let all their flats immediately (without incurring any marketing expenses), and can arrange for housing benefit to be paid directly to them. Sadly, these are often the worst conversions where the rent payable in housing benefit is above the level of market rent that such poor accommodation could command.
In 2015 it was estimated that 23% of office-to-residential conversions were being used to house homeless people. The Guardian discovered that Newbury House in Ilford, Redbridge, is now providing temporary accommodation for vulnerable people including young care-leavers. The seven-storey building on the edge of the A12 includes 60 studios, no shared amenity space, and does not appear to have passed Building Control. The ’kitchen’ appears to comprise a hob and there is a small quadrant-shaped shower room in one corner. It would be difficult to imagine a worse place to begin life as an independent adult.
Local authorities are estimated to have lost £10.8m in CIL contributions, with a further £4.1m lost to local planning authorities in planning fees that would have been payable
Many people have assumed that the PDR policy applies only to vacant offices, which are unlikely to attract new tenants. However, the government’s 2013 press release referred to ‘outdated and underused buildings’. RICS reports that, in the London Borough of Camden, the majority of the office space converted to housing in Camden was occupied. It found evidence of firms being served notice and leases not renewed.
London Councils’ 2015 briefing claimed that across London, 39% of all office-to-residential prior approvals for which information on occupation was available, involved fully occupied spaces. A number of London boroughs now report a shortage of office space, particularly the lower quality and therefore lower cost spaces suitable for start-ups and the creative industries. Most of the offices lost through PDR fall into this category. Their loss has had an adverse effect on the local economy and forced fledging business further from the centre where rents and rates are lower. The Greater London Authority estimates that more than 30,000 jobs have been disrupted in London and that most have involved SMEs.
A number of London boroughs now report a shortage of office space, particularly lower cost spaces for start-ups and the creative industries. Those lost through PDR fall into this category
The negative aspects that characterise office-to-residential PDR – poor internal space; outdoor amenity space; daylight; sound proofing; air quality and limits on dwellings per core – are many of the things that matter most to our daily quality of life.
Under PDR, schemes only need to comply with the building regulations. These deal with limited technical issues such fire safety, energy efficiency (though the standard is lower for conversions than new build), ventilation (but this need not be natural ventilation), and with soundproofing (notoriously difficult to test). They also deal with accessibility, but without a full planning application, only the default position of Category 1 can be required. That means that many older and disabled people would be unable to live in these homes once converted.
Office buildings are often located on noisy and polluted streets or roundabouts; often surrounded by car parks. Unsurprisingly, most of the buildings that have been converted are fairly tired; many date back to the 1960s and ’70s and are more than 50 years old. Very few offer any usable green space, none are likely to have balconies and few developers make any attempt to add them.
The seven-storey building on the edge of the A12 includes 60 studios, no shared amenity space, and does not appear to have passed building control
The government’s Housing Health and Safety Rating System (HHSRS) evaluates the potential risks to health and safety from deficiencies within dwellings. Its underlying principle is that, “any residential premises should provide a safe and healthy environment for any potential occupier or visitor”. To satisfy this principle: “A dwelling should be designed, constructed and maintained with non-hazardous materials and should be free from both unnecessary and avoidable hazards.”
This safety rating system identifies 29 potential hazards, and recognises some have the potential to cause psychological harm as well as physical harm. A dwelling found to contain hazards which pose a serious risk to health and safety can be prohibited from residential use by the local authority.
Hazards have traditionally been associated with older housing stock that has been allowed to fall into disrepair. The HHSRS, which is completely separate from the planning system, applies to all homes, old and new, of all tenures. It is increasingly clear that many of the new homes created in the private rented sector through PDR are likely to contain one or more hazards from the day they are completed, especially those related to “crowding and space”.
Drawing on the HHSRS, the Homes (Fitness for Human Habitation) Act 2018, which became law on 20 March 2019, allows a tenant to take their landlord to court if they believe their home is unfit for human habitation, as defined by the act. Any hazard that makes a property unfit is enough to require the landlord to take action. The new law defines additional criteria too, including the need for adequate facilities for food preparation and cooking.
The judge agreed that all flats in the property contained serious crowding and space hazards, and despite having a window, one flat was considered unacceptable in respect of natural lighting
We believe that many of the new homes created through office-to-resi PDR have serious hazards and are unfit for human habitation. A recent First Tier Tribunal decision in favour of enforcement action taken by Leeds City Council suggests that the flats in the case studies included in this report, and thousands of similar examples, are likely to contain serious crowding and space hazards.
The Leeds case involved a terraced residential property converted into a four-storey block of flats after the landlord installed a small shower/toilet cubicle and a basic kitchen into each of seven separate rooms. The usable space within each of the studio flats (the internal floor area, excluding the shower room) ranged from 10m2 to 17.47m2.
Despite the Nationally Described Space Standard not being specifically cited in the HHSRS operating guidance, the judge ruled that it is an appropriate modern benchmark against which to assess the hazard of crowding and space. In his decision, the judge agreed that all flats in the property contained serious crowding and space hazards. Despite having a window, one flat in the basement was also considered to be unacceptable in respect of natural lighting.
As noted, the HHSRS applies to all types of housing. Where homes in newly converted office buildings are challenged, they will be subject to the same basic HHSRS assessments. Inadequate ventilation and undue noise are also recognised hazards and many of the examples we have seen appear to fall short in these and other respects, too.
It cannot be right that thousands of the smallest homes ever legally permitted in this country have received the green light through PDR
While local authorities are usually unable to prevent these conversions from going ahead, however concerning the proposals appear to be at prior approval stage, when finished, their own enforcement teams have the power to inspect, and serve enforcement notices on the landlord where they find any hazards.
In practice, however, none of this is easy. Enforcement is often an expensive, drawn-out process that almost inevitably renders people homeless – two reasons why many councils prefer to leave well alone.
However the planning system, the HHSRS and the new Homes (Fitness for Human Habitation) Act 2018, exist for good reason. The drawings submitted for prior approval often indicate the potential for one or more hazards. The crowding and space hazard is nearly always in evidence. Councils surely have an implied duty to check that residents are safe – particularly when they have specific cause for alarm and know that many of the people housed in the worst conversions are vulnerable and would be daunted by the prospect of bringing their own legal case against their landlord.
The Leeds case demonstrates how poor conversions, whether under PDR or not, can be tackled and we are confident other local authorities will follow suit. It is widely accepted that the HHSRS is complicated and requires updating; referring to documents that no longer exist and failing to reference others that do. It is currently under review for those reasons. Despite this, in the Leeds case, the judge had no hesitation in stating that all flats could cause unacceptable psychological harm because the accommodation created was far too small.
It still makes good sense to convert an office building that is genuinely no longer needed, but this should only involve those with potential to become good places to live
It cannot therefore be right that thousands of other flats, of a similar size or smaller, and almost certainly the smallest homes ever legally permitted in this country, have received the green light through PDR.
While it makes good sense to convert an office building that is genuinely no longer needed or fit for purpose to another suitable use, this should only involve office buildings that are genuinely redundant and have the potential to become good places to live.
Few could have foreseen how inadequate some of the outcomes would be. But the warning signs were there before the end of the three-year trial period, and the government still decided to push ahead with plans to make it permanent in 2016.
Since then, and notwithstanding some notable exceptions, quality seems to be worsening as the more promising opportunities become scarcer. Space and light, ironically the two attributes within the home rated most highly by the public, continue to be squeezed out. In Newbury House, ‘two-person studios’ start at 14.6m2, the size of a typical double bedroom.
Quality seems to be worsening as the more promising opportunities become scarcer. Space and light continue to be squeezed out
It would be sensible for the Nationally Described Space Standard to be taken into regulation for a number of reasons, not least the fact that until that happens, developers will continue to negotiate on the grounds of viability even for developments that do go through the normal planning process. But that only solves one problem – space.
There is also the question of light. In 15-17 Grange Mills, a scruffy two-storey office building in a small industrial estate in Balham, the planning history is complicated, but documents show that prior approval was granted for 13 flats, with four of the ground-floor studios having just one window into a small covered lightwell and four of the upper-floor studios with only roof lighting; no window at all. Planning records show that someone else is now attempting to get twice the number of homes on the site: 26 studios.
In Southampton, 106 Shirley Road sees the conversion of a fireplace shop into six studios, 15m2-18m2, and so narrow that even single beds have to abut the wall. Apart from a window to the corner flat, the north elevation to Andover Road comprises a row of four new front doors, each with a sidelight. These are the only source of daylight to the four studios concerned and, because of the orientation, none will receive sunlight.
It is extremely worrying that, far from curtailing PDR, the government has recently consulted on extending it to other types of change of use and ‘upward extensions’
Another scheme in Watford, 1 Wellstones, has been granted planning at appeal, despite the fact that seven of the 15 flats will have no daylight at all. Despite the council’s efforts to prevent this pitiful conversion, the inspector found no legitimate grounds under PDR for refusal. Having lost the case, the council may even be liable for costs. But 1 Wellstones is wholly unsuited for housing in anything like its present form. Most recently used as an upholstery business, it has also been used as a petrol station and a repair workshop for gaming machines.
1 Wellstones illustrates the challenge in preventing poor-quality conversions. Last December, Watford Borough Council rejected the developer’s request for prior approval to the conversion under PDR, on the grounds that the flats would not have adequate light or ventilation. It cited concerns that the “oppressive environment would have serious impact on the health of the future occupiers”.
Other concerns, expressed by the mayor, included the unsuitable location, the lack of amenity space and the fact that “residents would step out of the building straight onto a very busy service road”. The developer took the case to appeal and on 5 July 2019, the planning inspector (appointed by the secretary of state), overturned Barnet’s decision and ruled that the conversion could go ahead as planned because under PDR there are no legitimate grounds for refusal.
In relation to means of escape (which looks extremely challenging for the upper-floor flats, given the absence of windows), the inspector noted: “A lack of details as to means of escape... does not result in the proposed development not being (suitable) for new dwellings.” He is of course right under the strict terms of PDR, but post Grenfell this is now something that might well be flagged up under a normal planning application. This is perhaps the starkest example yet of what this policy has led to. Unsurprisingly, it has led to a public outcry.
Had these proposals gone through the usual planning process they would have been properly scrutinised and tested. Quite properly, they would have failed these tests
The location of many office-to-residential conversions is another serious concern. Newbury House is on the edge of the A12, a six-lane, dual carriageway with a 70mph speed limit – effectively a motorway. The incessant noise and poor air quality make this not just an undesirable place to live, but a dangerous one. Grange Mills is located on an industrial estate. If it goes ahead, it will offer no usable outdoor space and no privacy. Both schemes, and thousands of others, are very clearly at odds with the government’s stated aim to build “the right homes in the right places”.
Had these proposals gone through the usual planning process they would have been properly scrutinised and tested against the London Plan, The London Housing Supplementary Planning Guidance and any additional local standards, through a democratic process. Quite properly, they would have failed all of these tests.
The planning system exits for a reason and this form of PDR has highlighted the need for all development that results in a significant change of use, particularly residential use, to be subject to normal planning procedures. Professional concern is being reflected in public concern. The vast majority of the readers who commented on The Guardian’s coverage of Newbury House were shocked and dismayed by what they saw, and read.
In an interview conducted by the RICS, one resident spoke for many us: “I’m speechless. How can this be allowed in a civilised country? It is so wrong. The politicians who allowed this [PDR] need to come and live here. It’s a total nightmare.”
It is therefore extremely worrying that, far from curtailing PDR, the government has recently consulted on extending it to other types of change of use, and to ‘upward extensions’.
In light of the mounting evidence that these homes are not fit for human habitation, we have set up a petition to force a debate in the House of Commons. The need for housing must not come at any price – please show your support and sign here.
Read the full report on the impact of PDR for office-to-residential conversions
Sign the petition to force the government to debate office-to-resi PDR