Following his recent pledge to oppose a further extension of permitted development rights, London Mayor Boris Johnson has joined property groups and planners in calling for continued protection for key business districts.
Under the government’s proposals to extend the scheme, which makes it easier to convert office space to housing, local authorities will lose their automatic right to seek exemption from the ruling. Other categories of commercial property will also be incorporated into the changes.
The scheme was introduced last year, for an initial tree-year period, in a bid to ease the housing crisis. Subsequently many areas have reported significant reductions in office stock, with reports emerging of cases where commercial tenants have been forced to leave properties as landlords seek to cash in on the booming residential market.
It is feared that if exemptions are made more difficult to obtain, or scrapped entirely, it could lead to the loss of millions of square feet of office space in the London market alone.
Now a letter to Communities Secretary Eric Pickles, seen by the FT, calls for the continued protection of key business districts. These include the City of London and Canary Wharf, the Royal Docks development zone and East London’s Tech City.
Along with Mr Johnson, the signatories are the British Property Federation (BPF) – which expressed concerns about the proposals last month – the Planning Officers Society and lobby group London First.
The letter states that; “Without this exemption there is a very real threat to the future of nationally and internationally significant business locations.
“Incremental unplanned loss of office accommodation in strategically important office areas of London can significantly weaken the agglomeration benefits provided by these locations.”
It continues to argue that, while the signatories agree that an increase in the capital’s housing stock is ‘vital’, the proposals could threaten future economic growth.
“London’s success depends on a rich mix of uses, and more high-value residential property in central London could upset this balance and change the area for good,” the letter warns.
In a separate move Business Secretary Vince Cable has also condemned the government’s policy, describing it as a “particularly bad example of central imposition.”
According to Colliers International, 1.5 million sq ft of office to residential conversions are currently in the pipeline in the West End. Other consented schemes could result in the loss of a further 1.82 million sq ft of office space.
“Whilst many of these offices may be of a secondary nature and past their natural life, the fact that residential projects continue to be favoured ahead of commercial development will put further pressure on an office pipeline that is already struggling to keep up with demand,” said Co-Head of Central London Agency & Development, Paul Smith.
“Supply of Grade A space is becoming particularly acute in the Core West End where there is currently just 250,000 sq ft of new space available in buildings of over 25,000 sq ft, and only a further 180,000 sq ft planned by the end of this year.”
