We also gravelled the front area and installed lockable storage sheds, which provided essential storage space – always a premium in smaller flats. As you can imagine, completing a conversion project like this is nearly always going to take a shorter time to complete than a new-build project.
So, how did we convert the entire building to residential when no single PD right allowed us to do it? Well, under Class G, we had the right to convert the upper floor to two flats, so we first gained this approval. Once this right was established, we then used Class M to convert the ground floor to residential, as it measured less than 150m2 and was in retail use on 20th March 2013. We were then able to complete the project in a single build phase. Hopefully, this demonstrates how, by using multiple development rights, a little planning knowledge can go a long way. We also appointed a Project Manager to oversee the build, so our involvement as a developer primarily involved a weekly update call rather than having to manage things personally on site.
Ok, here’s a test question for you. Imagine you owned a retail unit and wanted to convert just the upper floor to residential. You want to build four 40m2 flats, but there’s a problem. Class G only allows you to add a maximum of two flats per retail unit. This would potentially mean building two large 80m2 flats instead of four smaller ones, which doesn’t make financial sense. And Class M doesn’t apply because the shop is bigger than 150m2. So what would you do?
Do you give up? Well, the answer is to divide the ground floor retail unit into two retail units first, something you can do without planning permission or prior approval. Then, once you have your two retail units in place, you can use Class G to build two flats above each, giving you your four 40m2 flats.
Many of my development students are often surprised to learn that the scale and complexity of development projects are far less than they thought, yet the scope to take advantage of permitted development rights is significant, particularly with a decent planning consultant in tow. For many landlords, the clincher is that a simple conversion project can net a sizeable profit in relatively short timescales. As a result, it’s an ideal solution for fast-tracking portfolio growth by creating regular lumps of cash through small-scale, lower-risk development projects. Is it easy or risk-free? Definitely not, but it’s certainly very achievable, particularly as so much of the expertise comes from a readily available team of professionals all overseen by an experienced project manager.
So what of the future for PD rights in general, and retail conversions in particular? The poor old high street has undoubtedly taken a battering over the past few decades. First, the out-of-town supermarkets had it on the ropes, and then online retail arrived and pretty much sent it sprawling to the canvas. And if that wasn’t enough, we’ve got the impact of COVID-19 and Brexit waiting in the wings.