Retention of Employment Land and Premises SPD

5.0 Changing to alternative uses

5.1 The diagram below shows the approach the Council will take in determining whether an alternative use to that existing can be considered, once contact with the Council and a marketing campaign has been undertaken.

Figure 1 Text Alternative

1. Is the site suitable, in land use terms, for continued employment use?

If 1 = NO

Consider alternative uses provided that it does not conflict with the character of the surrounding area and other policies and proposals of the plan.

If 1 = YES, go to 2

2. Is there a proven demand from another employer to re-occupy the site?

If 2 = YES

Retain the full site in employment use.

If 2 = NO, go to 3

3. Is the retention of the site in employment use either as it stands, or following refurbishment or redevelopment to a new employment use a financially viable option?

If 3 = YES

Retain the full site in employment use.

If 3 = NO, go to 4

4. Is the site both appropriate and viable for a mixed use development incorporating an element of employment uses?

If 4 = YES

Require an appropriate mixed use development on the site incorporating an element of employment uses.

If 4 = NO

Consider alternative employment generating uses, outside of the 'B' use class.

Test 1 - Is the site suitable in land use terms for continued employment use?

5.2 Where an applicant is seeking to demonstrate that an existing employment site is not suitable, in land use terms, for continued employment use, the Council will expect a planning application to be accompanied by a detailed supporting statement that seeks to demonstrate that this is the case.

5.3 In determining a site's/premises suitability in land use terms, the Council will take into account the fact that there are considerable differences between employment uses. Although one use may, at present, cause amenity issues, this does not necessarily rule out the ability of the site/premises to accommodate a less disturbing employment use.

5.4 Where consideration is being given to alternative uses of employment land or premises, any such proposals must ensure that the proposed use does not conflict with the character of the surrounding area and other policies and proposals within the Plan, or any other material considerations.

5.5 The following tests should be examined concurrently through your marketing campaign.

Test 2 - is there proven demand from another employer to reoccupy the site?

5.6 Is there a proven demand for other employment uses to occupy the premises/site in its present condition?

Test 3 - Is the retention of the site in employment use either as it stands or following refurbishment or redevelopment to a new employment use a financially viable option?

5.7 There may be instances where an applicant can demonstrate that there is no demand for an employment site in its present condition and that the site's buildings are of a state that they would be unsuitable for continued employment use. In such cases, it is important to recognise that the value offered by such sites does not arise solely from the existing buildings but from the potential the site offers as a suitable location for future employment uses. The Council will therefore, expect an applicant to provide evidence that they have carefully considered how the site could be refurbished or redeveloped for employment purposes and that they have marketed it accordingly.

5.8 Furthermore, although the retention of the site in employment use may not be viable at a particular moment in time, the economics of development may change over time and refurbishment/redevelopment for employment uses could potentially become a viable proposition in the future. In this respect, such sites are still considered to have value as an employment resource.

5.9 In view of this, applicants will be expected to clearly demonstrate in a supporting statement accompanying the planning application, why they consider that new employment development cannot be achieved on site for reasons of financial viability. The Council will give full consideration to the evidence submitted. It may need to take independent advice on the information provided and the applicant will be expected to pay the Council's expenses for this.

5.10 There are two stages to establishing that a site is in such a poor condition that it is uneconomic to either refurbish or redevelop it for employment purposes:

1. Establish from marketing that prospective occupants are not proceeding with the purchase because of the condition of the premises;
2. Establish that the costs involved in refurbishing or redeveloping the site for employment use are greater than the return that could be anticipated.

5.11 The Council is unlikely to concede that the site is in poor condition unless this conclusion can be drawn from site marketing evidence (this evidence must be provided in line with the marketing section of the SPD). In considering marketing evidence the Council will pay particular attention to the market price at which the site has been offered. It will expect the price to reflect the current state of the property.

5.12 The following evidence will be required to demonstrate a case that the costs of refurbishment/redevelopment exceed the likely returns from the site:

1. A full structural survey of the existing premises highlighting the matters that require refurbishment or which are incapable of refurbishment. This survey should be prepared by a suitably qualified professional consultant;
2. A survey of the site from an operational point of view indicating any exceptional or site specific costs. These costs to be prepared by a suitably qualified professional consultant;
3. A detailed cost breakdown of the works required to refurbish/redevelop the site. These costs to be prepared by a suitably qualified professional consultant;
4. Written evidence from 3 recognised separate financial institutions of the likely cost of borrowing over a fifteen year period to fund these costs;
5. Written evidence from 3 recognised separate financial institutions that they would not be prepared to advance finance for refurbishment/redevelopment, with the applicant to bear any costs involved in obtaining this information; and
6. An indication (in the case of a prospective landlord) that the anticipated rate of return from the premises would not cover the costs of refurbishment/redevelopment;
7. An indication (in the case of a prospective owner occupier) that the level of income needed to cover both the costs of refurbishment/redevelopment and other necessary overheads would be unsustainable.

5.13 The Council will seek to verify any such information submitted under these criteria. It is recognised that some of this information is of a confidential nature and the Council will take steps to ensure that it is not made publicly available or used for purposes other than those set out in this SPD.

5.14 Where it can be demonstrated that redevelopment for employment purposes alone cannot be achieved on financial grounds, the Council expects applicants to consider:

1. Approaching support agencies to see whether additional funding may be available to assist the redevelopment and,
2. Preparing alternative schemes which can deliver some employment floorspace on the site.

Test 4 - Is the site both appropriate and viable for a mixed use development incorporating an element of employment uses?

5.15 There may be instances where a site's sole use for employment purposes is no longer viable. In such cases the Council will expect applicants to have examined the possibility of developing either mixed use schemes, including live/work units, or other elements including some residential to cross fund development. In such cases, and where this is demonstrated by the Applicant/Agent, the Council will adopt a more flexible approach and, will seek to secure a mix of land uses.

5.16 In assessing such proposals the Council will normally expect, at least, the equivalent amount of employment floorspace to be delivered on site as exists under the present use. Where this cannot be achieved the Council will expect that the other elements of the scheme should be the minimum necessary to support a viable employment development on the site. Applicants will be required to submit a reasoned justification as to why the employment floorspace cannot be replaced in full.

5.17 When determining the proportion of the overall site to be developed for employment uses, the Council will assess the individual merits of each case, but in doing so will take account of the employment resource being lost and the potential level of employment that can be achieved within the mixed use development.

5.18 If a mixed use scheme is pursued, then any planning permission granted, subject to other material considerations and those items detailed in this SPD, will be conditional on the delivery of the employment uses on the site which is linked to the higher value use/s. It will normally be expected that the employment element will be required to be constructed in advance of the higher value uses.

5.19 Where an applicant has demonstrated the continued use of a site/premises either for solely employment use or a mixed use scheme is not viable, then in accordance with our sequential approach, other employment generating uses not within the 'B uses' of the Town & Country Planning (Use Class Order) 1987 (as amended) will be preferred.

5.20 If an applicant/agent considers that an employment scheme can only be made viable by incorporating a residential element to the scheme, then it should be demonstrated why a non-residential mixed-use development, including employment floorspace, is not feasible on a particular site. The evidence required should include relevant cost information as detailed in the viability section of this SPD. Where this is satisfactorily demonstrated residential development proposals will need to demonstrate that the resulting residential amenity conditions are satisfactory and that there would be no unacceptable impact on the operating conditions of existing and potential businesses allowable at a location by virtue of its potential use classification.

5.21 Any outline approval granted for residential development on an existing employment site will normally be conditioned to ensure that any subsequent reserved matters conform with the agreed approach, whether that be in relation to a mixed use proposal or through the conversion for other employment generating uses.

What will be done with the evidence?

5.22 Evidence will largely be assessed in house. However, in exceptional circumstances the Council may seek external advice and verification of the evidence submitted.