News

The only way is up. Or is it?

by and on for Estates Gazette

https://www.egi.co.uk/legal/the-only-way-is-up-or-is-it/

The article as it appeared in Estates Gazette 

There have been quite a few giddy headlines about the new upward extension regulations, part of new permitted development rules coming in on 1 August (the Town and Country Planning (Permitted Development and Miscellaneous Amendments) (England) (Coronavirus) Regulations 2020).

There have been predictions of a “golden age” of building and claims that this is a game-changer for developers. While the “reach for the skies” headlines are certainly attention-grabbing, the reality is slightly less of a free-for-all than one might imagine. Apologies for having to bring you back down to earth.

What’s allowed?

Upwards extensions of up to two storeys, which must be new flats on the topmost residential storey only, of existing detached, purpose-built blocks of flats, of three storeys or more, above ground-level built after 1 July 1948 and before 5 March 2018.

What isn’t?

The following exclusions apply:

  • Conversions of listed buildings or land in their curtilage; scheduled monuments; and buildings within conservation areas
  • Developments in:
    • areas of outstanding natural beauty;
    • the Broads;
    • National Parks;
    • sites of special scientific interest;
    • safety hazard areas;
    • military explosives storage areas; or
    • land within 3km of the perimeter of an aerodrome.

Assuming you get through the “what’s allowed” hoops, there are then further requirements:

  • that the building will not, after the works, be more than 30m high, excluding plant;
  • that the floor-to-ceiling height of any additional storey will not be more than 3m in height or higher than the floor to ceiling height of any of the existing storeys (whichever is lesser); and
  • that the overall height of the roof of the extended building must not be more than 7m higher than the highest part of the existing roof, again excluding plant.

The new development must be completed within three years from the grant of prior approval.

Prior approval?

Yes, even though this is permitted development, it doesn’t just mean that you can go ahead without prior approval from your local planning authority. You will need to address the following:

  • transport and highways impacts;
  • air traffic and defence asset impacts;
  • contamination risks;
  • flooding risks;
  • external appearance;
  • the provision of adequate natural light in all habitable rooms of the new dwellinghouses;
  • the impact on the amenity of the existing building and neighbouring premises including overlooking, privacy and the loss of light; and
  • whether, because of the siting of the building, the development will impact on a protected view.

And that’s before you even think about health and safety requirements.

So there is still a fair amount of work to be done, and it’s not a tick-box exercise.

Got all that – what else do I have to think about?

Planning is only one consideration when considering airspace developments. There are lots of elephant traps on the legal front also. Of course there are. Here are some for you to consider.

  • Do I own the airspace?

You might think that this is obvious, but it needs to be checked. There may be a telecoms operator to deal with (good luck with that) or rights to keep equipment on the roof, eg air conditioning equipment or vents or aerials.

  • Rights of light

A legal right of light and one’s entitlement to it sits outside planning and permitted development. Many get confused at the difference between a daylight/sunlight report for planning and legal rights of light and think that once they have satisfied the local authority test that is all they have to do. Many a developer has fallen foul of rights of light by not appreciating this distinction.

  • Breach of covenant

There are all sorts of covenants in existing leases which may be breached by a rooftop development. Nuisance and quiet enjoyment to name two. The existing leases need to be examined to see what rights the landlord has to redevelop the building.

  • Alterations to common parts

Rooftop developments often require adjustments to common parts as well as alterations to the exterior. The developer will need to ascertain whether or not it has all the practical rights it needs to carry out the development.

  • Service charge

If there’s a fixed service charge, this could cause an issue as the addition of extra flats will not have been envisaged and the leases may all need to be varied. The word “ransom” starts to rear its head.

  • Landlord and Tenant Act 1987 – right of first refusal

One of the easiest areas to overlook and one of the most deadly if one gets it wrong. You need to make sure that you aren’t inadvertently committing a criminal offence by selling off the airspace to a developer.

  • Collective enfranchisement

The tenants could club together to buy the building and a recent case on this issue (LM Homes Ltd and others v Queen Court Freehold Co Ltd [2020] EWCA Civ 371; [2020] EGLR 18) examined the practice of splitting off various parts of properties into separate leases to avoid the 1987 Act and how that worked in relation to collective enfranchisement. The takeaway from this case is that this practice will not always be enough to avoid the application of collective enfranchisement.

A developers’ charter?

Much as one hates to rain on a development parade, it’s clear that this legislation, while endeavouring to encourage upward extension, is a change which will need to be considered carefully. The government has sought to address some concerns around permitted development, eg the issue of daylight, and there are a number of issues to be addressed which make this less completely permitted development, as it used to be, and more akin to planning permission-lite.

There are many legal missteps that can be made on the way, some of them which could prove to be very costly as well as risking a stay at Her Majesty’s pleasure. Make sure you understand the detail before scouring the skyline for your next development opportunity.

Nicky Richmond is managing partner and Anjana Ghosh is a director in the planning team at Brecher

Nicky Richmond

Managing Partner & Head of Real Estate Finance & Banking

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