Mayor wants planning exemption to protect London’s business districts

09 October 2014

The Mayor of London is bidding to preserve London’s key business districts by urging the Government to reconsider proposals that could see valuable office space in the capital turned into homes.

Last year the Mayor negotiated for four defined areas in central London to be exempt from a Government policy that allowed office space to be converted into homes without developers applying for change of use planning permission.

These areas included the ‘Central Activities Zone’ which incorporates the City of London, the South Bank and the West End. More than a third of London's jobs are within this area, and a further 280,000 jobs are expected to be created here in the next 25 years. The Mayor also successfully gained exemptions for the commercial area north of the Isle of Dogs and London's Enterprise Zones in the Royal Docks, plus the part of the City Fringe in east London which makes up the emerging "Tech City" opportunity area.

The Government has just finished consulting on a raft of planning proposals including one that would see the exemption for these areas removed – a move that the Mayor says would damage London’s internationally important business locations.

London is the beating heart of the UK economy and accounts for over a fifth of GDP. It is also a global centre for business, so the Mayor believes it is vital to maintain a stock of quality office space in key areas to ensure the city can continue to attract jobs and growth. The city is home to a number of unique clusters of economic activity from government offices, to financial services, institutions and professional bodies, which employ millions of people, contributing billions to the national economy. The Mayor believes that if these clusters were to be broken up in piecemeal residential conversions these benefits would disappear.

In a letter to the Secretary of State for Communities and Local Government, Eric Pickles, the Mayor, together with London First, the British Property Federation and the Planning Officers Society London say that “incremental unplanned loss of office accommodation in strategically important office areas of London can significantly weaken the agglomeration benefits provided by these locations.”

The Mayor of London, Boris Johnson, said: “London is a colossal powerhouse of jobs and growth, and the motor of the UK economy. While increasing housing output is of vital importance, I am concerned that removing the exemption in our most thriving business districts could compromise both London and the UK’s 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 Mayor and signatories to the letter also argue that criteria should be in place to protect other, strategically important business locations across the country. They argue that due to the large variation in size and function of office clusters throughout the country – especially between London and other cities in England – it would be challenging to agree detailed criteria and so instead put forward to the Minister a possible process to achieve this.

The Mayor is on track to build a record 100,000 low cost affordable homes for Londoners over his two terms, with more than 77,000 already completed. He is also funding a major future pipeline of additional homes beyond 2016. This year alone, more affordable homes are being built than in any other year since 1980.

Faraz Baber, Director of Planning Policy at London First, and a signatory to the letter, said: “We see merit in expanding permitted development rights , such as the ability to change land uses in the high street (like turning shops to banks and vice versa) without going through the planning process.

“But we have serious concerns over the proposal to remove existing exemptions from PDR in areas like the Central Activities Zone. These internationally recognised hubs of economic activity have a finely balanced mix of land uses that are carefully managed by the planning process. They must remain managed through the planning system.”

Liz Peace, chief executive of the British Property Federation, said: “The relaxation of permitted development rights is a key part of the Government’s move towards speeding up and streamlining the system and encouraging new housing to come forward in the current crisis, but, it’s important to maintain thriving commercial areas in which people can work and play too. We should not underestimate the importance of agglomeration for businesses as productivity rises when places of employment are in close proximity to one another. Those areas of London which are currently exempt from permitted development rights are bustling commercial hubs which provide essential jobs and services to the city and maintaining this variety of commercial and residential zones is crucial to the health of a city like London. ”

Michael Kiely, Chairman of the Planning Officers Society London, said: “POS London has been liaising with BPF and London First over issues of mutual interest and we are very pleased that all sides of the development sector have come together and agreed a joint position on this vital issue for London.”

 

Notes to editors

 

The Central Activities Zone (CAZ) contains a unique cluster of vitally important activities including central government offices, headquarters and embassies, the largest concentration of London's financial and business services sector and the offices of trade, professional bodies, institutions, associations, communications, publishing, advertising and the media.