The government’s attempt to clarify the vacant building credit (VBC), introduced last November, is generally welcome news for the development industry which has been somewhat perplexed by its practical implementation, although it may raise more questions than it answers.

Two key revisions made recently to National Planning Practice Guidance (NPPG) are worthy of note, in particular:

1. "Consider whether the building has been made vacant for the sole purpose of redevelopment", and

2. "Whether the building is covered by an extant or recently expired planning permission for the same or substantially the same development".

The first attempts to clarify that a developer can’t deliberately make a building vacant in order to benefit from the relief bought about by the credit. Proving what is ‘vacant’ floorspace/buildings will remain difficult. Overall, more guidance will most certainly be needed on this issue once the new government administration has bed-in - assuming it is retained at all - possibly along the lines of the Community Infrastructure Levy definition of what constitutes ‘vacant’.

The second suggests that a developer can’t go back in for planning to benefit from the credit. It has been rumoured in some quarters that developers have been resubmitting applications in regard to already consented schemes. So, it appears that we may have a case of unintended policy consequences causing some planning authorities to voice concerns about net reductions in affordable housing contributions. This reaffirms our deep seated concerns about the suitability of generic planning policy trying to respond to all property and housing markets despite significant regional variations or even site specific circumstances.

Local authorities will clearly need to consider the veracity of each VBC case, and eligibility will inevitably now be cast into some doubt.

In all but contrived scenarios, there is potentially little practical change from the revisions. For example, some schemes don’t get built-out straight away for perfectly logical commercial reasons. The local market may have shifted requiring a realignment of the size and type of units, a change in land ownership (acquisition of adjoining properties) may have materially changed the scheme, and such level of revision would not be capable of implementation without a revised planning permission. Local authorities should understand this.

The vacant building credit remains applicable nationwide, albeit the intention is clearly to kick-start buildings/development in those locations that are still emerging from the last recession. The Government's use of blunt tools to address specific development blockages will continue to kick up unintended consequences, and whilst that remains, opportunities will continue to emerge where politicians were least expecting them. Clearly the more pressing issue is what happens after May 7th...

See you for Part 3, soon!