Spike in activity to convert office blocks into homes

The number of applications to convert office blocks into homes increased last year, official figures have revealed, reversing a six-year trend of declining activity.

Data from the Department for Levelling Up, Housing and Communities showed that 2,119 bids were made in 2021 to use permitted development rights allowing buildings to be switched from workplaces to residences.

This was the highest number since 2017, and the first time application numbers have not fallen since the rights were introduced in 2013.

Approvals were up as well, with 1,179 requests granted in 2021, more than in any of the prior three years.

Andrew Wilmot-Smith, partner in the commercial real estate team at law firm Boodle Hatfield, said the long-term impact of the pandemic on the built environment was becoming clear.

“With businesses adopting new models of working, developers are making use of excess office space to deliver much-needed housing,” he said.

Many office buildings are centrally located with good transport links, making them ideal for converting into apartments, added Wilmot-Smith.

But he warned that careful consideration was needed when considering a project of this nature as people had different expectations of homes than of workplaces.

“Local authorities and developers need to work together to ensure that vacant office space is put to good use,” he said. “Any office space converted to residential property needs to be high quality, sustainable, and up to appropriate health and safety standards.”

Permitted development rights allow certain projects to take place without full planning permission. However, developers still have to apply to the local authority for ‘prior approval’ – essentially a significantly slimmed-down consent process. Projects still have to comply with certain standards.

Planning authorities can apply for Article 4 directions to remove permitted development rights in certain areas. But Boodle Hatfield said council appetite to use Article 4 to protect offices was waning in the wake of the pandemic and in light of the housing crisis.

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