What will changes to use classes mean for traditional high streets?

The new regulations amend the Town and Country Planning (Use Classes) Order 1987 and create three new use classes as follows:

• Class E: commercial, business and service – includes previous uses A1 (shops), A2 (financial and professional services), A3 (restaurants and cafés) and B1 (business);
• Class F.1: learning and non-residential institutions; and
• Class F.2: local community.

New class E is very wide; it includes retail, food, some services, gyms, healthcare, nurseries, offices and light industrial uses. Classes F.1 and F.2 take in current use classes D1 (non-residential institutions) and D2 (assembly and leisure). Some uses will no longer fall within a class, meaning planning permission will be required to change – including pubs and bars, hot food takeaways and cinemas.

Why are the changes important? High streets across the country have been struggling during recent years as they fail to compete with online retailers and large out-of-town retail parks and shopping centres. The move to online shopping has been accelerated by Covid-19, as many traditional high streets have been forced to close for the last few months and many customers feel uncomfortable shopping in person.

By creating a new ‘commercial, business and service’ use encompassing all the uses outlined above, it will be possible to move between uses without the need

for permitted development rights or planning permission. This will give more flexibility to property owners; for example, a property could operate as a shop during the day and a restaurant or a gym in the evening.

So, what do the changes mean? Should new leases refer to new use class E? This is unlikely. Tenants may welcome the flexibility of an open E class use, but the uses within the class are so wide that landlords are going to require more control. Landlords will need to think carefully about what range of uses and flexibility they will permit in leases in the future based on their intentions for the property and any wider placemaking strategy.

Nick Harding is real estate associate at Gowling WLG