Westminster office conversions latest 17th December 2014

Westminster City Council has today begun consultation on planning policies to encourage and protect offices in central London.

Completed schemes over the past 4 years have resulted in the loss of 1.8m sq ft of offices, with a further 1.7m sq ft of losses in schemes under construction and potential losses of up to 2.7m sq ft in planning applications granted but not started (off-set by only 770,000sqft of new office floorspace coming forward). This has delivered 1,278 homes, but at the cost of office floorspace comparable to an estimated 11,500 jobs.

The loss of offices from schemes currently under construction will create a further 2,220 homes, but represents the loss of floorspace capable of accommodating almost 11,000 jobs. Permitted schemes that have not been started represents a net loss of 183,000sqm of offices, sufficient for about 12,500 jobs, and permission for 1,624 homes. Due to significant increases in the loss of offices over the past four years, the council said it wants to secure the future of much-needed space in the capital and is proposing a number of steps to do so: - The existing policy seeks an equivalent amount of residential floorspace where there are increases in commercial floorspace of more than 200 sq m in the case of offices (B use classes), or more than 400 sq m in the case of shops and restaurants (A use classes) or private community and leisure uses (D Use Classes).

The proposed approach would allow increases up to 30% of the original building without any requirement for housing. Between 30% and 50%, the developer can decide whether to provide the residential floorspace on-site, off-site or by a credit, or make an appropriate payment in lieu for the Council's Affordable Housing Fund. Above 50% uplift in floorspace, the original policy will apply.

This is a significant change to current policy which will incentivise office floorspace delivery in the city. - Where there is a change of use from office to residential or the replacement of office floorspace with residential floorspace, a proposed policy would require an equivalent amount of commercial floorspace and/or social and community floorspace where there is an increase the amount of floorspace by more than 30% of the original building.

Alternatively, these proposals may be refused where the mix of housing proposed doesn't outweigh the loss of the office floorspace. However, these will not apply if the office was originally built as housing. - New policies on credits and land use swaps offer greater flexibility to bring forward the right floorspace in the right locations. Westminster has seen a significant increase in office losses over the past 4 years and there is also a significant pipeline of applications that may be realised over the next few years. This issue has emerged relatively recently and is therefore not part of the current policy framework. However, early action is required to stem the loss of business floorspace.

The City Council is also resolute in its position that Central London must keep its exemption for government legislation which allows offices to be turned into housing without needing planning permission. Without this, London's global competitiveness will be threatened. The council has been monitoring office to residential conversions, and office losses more generally (including redevelopments which result in a net loss of offices, and changes to other uses than residential).

Cllr Robert Davis, deputy leader of Westminster City Council, said: "Westminster has had a long standing and successful mixed use policy which actively requires residential alongside commercial development in the Central Activities Zone. "However, unprecedented changes have been seen recently. While the office market is still very strong, the residential market - once something which needed policy intervention to grow in central London - is now outbidding office revenues at levels that would have been unthinkable a decade ago. "Much of this residential growth has come from a change of use of office stock that cumulatively contributed to Westminster's nationally and internationally important employment base. "Westminster needs to grow its commercial floorspace, particularly offices, in order to remain globally competitive. The need to reverse the current trend cannot be overstated given Westminster's role in the London and UK economy."