CFI: Commercial


The homes in the shop window by


Rob Lankey, managing director, Commercial Mortgages, Aldermore


Two running themes have come out of this recession and they aren’t mutually exclusive. One is the urgent need and demand to build more homes, particularly in the south east and London. Te second is the regeneration of British town centres. Much has been made of the


decline of the British High Street. So much so that the government launched a cam- paign, fronted by retail expert Mary Portas,


to bring much


needed investment into run- down towns like Margate and Stockport which have both been severely hit by the eco- nomic downturn. While one can question


whether the funding provided to the Portas scheme (£1.2m) was enough or whether the re- sults should be judged within such a short time frame. Te issue remains that thousands of retail units up and down the country remain empty, one in four according to the most recent figures from the British Retail Consortium.


Stopping the rot So what is the solution? Re- duce business rates and other levies to encourage potential vendors? A National Insur- ance holiday for new shops? A further rethink on Sunday opening hours? Well quite possibly, but the government has other ideas to stop the de- cline. Te Department for Com- munities and Local Govern-


www.mortgageintroducer.com


ment (DCLG) is launching a consultation into possible changes to planning laws that could make it easier to convert commercial property into a residential one.


Proposed reforms Te changes proposed would allow councils to retain lim- ited powers to reject the con- version on the basis of ‘loss on the economic health of the town centre, the need to main- tain an adequate provision of essential local services such as post offices, and the potential impact of the change of use on the local character of the area’. Tere are naturally addi-


tional caveats that develop- ers need to be aware of, but the changes would be limited to buildings of a certain size, could only be converted to a single dwelling or a maximum of four flats and finally, the secretary of state would retain the power to overturn refusals if it was deemed as ‘unreason- able’. So if


the reforms are ac-


cepted, are we on the brink of wholesale reforms of our plan- ning laws and perhaps more importantly will it change the landscape of our towns up and down the country?


Back to the future Tis is not the first time we have heard of similar propos- als. Earlier this year, plans were put forward to ease the conversion of former office buildings into blocks of flats, without the permission from local councils. So the govern- ment seems intent on pushing this through. Tere is a perfectly viable


reason for welcoming these changes. Empty units do not


look welcoming or suggest an area is thriving. Te eco- nomic argument is convinc- ing as well. What is the point of retail space, if it lies unoc- cupied? Research from coun- cils in London suggests that empty shops cost London £350m each year in lost busi- ness. Why therefore would a


“If the reforms are accepted, are we on the brink of wholesale reforms of our planning laws and will it change the landscape of our towns up and down the country?”


council take the risk of allow- ing a shop to remain dormant, when it has the potential of be- ing converted into a house or several flats? Nick Boles, the planning


minister, who has taken to task the existing planning laws, be- lieves that the proposals will not only help fill thousands of empty and underused build- ings but consequently boost existing shops. Boles makes some valid


points, particularly the fact it would address the need for more housing in rural areas. He is also correct to addition- ally address that we should no longer see our town centres as they were in times gone past. I think everyone wishes to see


towns and cities thriving with a range of independent and big stores, but ultimately the internet has changed this en- tirely.


Financial black hole People on both sides of the argument agree on this, but they would call these changes slightly wishful and hedg- ing any future prospects of growth. For one, we are emerging from the deepest economic crisis since before the war and who is not to say that by simply allowing con- versions to occur with more haste and fewer checks, we are setting ourselves up for an of- fice space shortage in years to come. Something that could be particularly true in bigger cities. Additionally, although


councils are losing out in the short


term, a conversion to


a residential property would transform incomes from busi- ness rates to council tax. Tis could potentially cause finan- cial black holes in council budgets around the country. Councils are facing a tough time balancing the books al- ready, so gambling on short- term benefits could well be ill- planned in years to come. Finally, perhaps the stron-


gest point is that while in some circumstances it makes sense for the plans to go through, it should not be a substitute for building new homes. We do not build enough houses as a nation and while this may resolve a shortfall, it will only represent a small percentage of Britain’s needs. Te government is correct


to introduce the consultation, but it should not deflect from the bigger issues.


MORTGAGE INTRODUCER SEPTEMBER 2013 45


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52