What Is Going On

In a written statement made by Kris Hopkins, Parliamentary Under Secretary of State for Communities and Local Government, on 26 January 2015, it was announced that the Government intends to intervene to protect public houses that are listed as Assets of Community Value (ACV), by removing permitted development rights for change of use or demolition.

Currently, all public houses fall under Class A4 of the Use Classes Order and benefit from permitted development rights which allow a change of use to Class A1 (Shops), Class A2 (Banks and Estate Agencies) and Class A3 (Restaurants and Cafes) without the need to apply for planning permission. A building or piece of land that appears on the ACV register has a number of restrictions. Most importantly, if a public house is listed on an ACV register and is offered for sale, the local community is given six months to prepare a bid to buy it. This can lead to major delays in achieving a disposal, can increase holding costs as well as the time a site sits vacant or derelict.

The Proposed Changes To Legislation

The changes proposed by the Government would remove all permitted development rights currently enjoyed by public houses which are registered as ACV.

This would result in planning permission needing to be sought for any change of use or demolition of a public house registered as an ACV.

The key point is that the proposed legislation would remove a large degree of flexibility currently enjoyed by owners of public houses. Any change of use or proposal for demolition of an ACV pub would require planning permission, requiring the local planning authority (LPA) to determine a change of use or demolition in line with its Development Plan.

As you will be aware planning policy across the UK is generally moving towards protecting public houses, with the Mayor of London recently directed the London Boroughs to develop planning policies to protect public houses. The protection of pubs as ‘community buildings’ is anticipated to be tightened considerably in the run up to the election.

In conclusion then, an ACV nomination can seriously affect your flexibility and asset value, especially if you are in a sales or acquisitions process.

Iceni Projects Ltd are well placed to provide advice on navigating the complicated ACV process and objecting to ACV nominations and reducing risk.