Property Investor News Article October 2023

How to Get PD on Buildings ‘Outside Use Class E’


In July, we looked at generally the issues that can arise when looking at pub conversions to residential use. Despite a brief break last month, when we digressed to consider some of the new changes to permitted development rights (none involving pubs, I hasten to add), we now move back this month to consider the subject of pub conversions, looking in particular at a recent case study.

Buildings in Class E use

Use Class E comprises a mix of former Class A uses – shops, restaurants, financial and professional services – and former Class D uses – medical and health services and creches, day nurseries and some indoor and outdoor sports uses, such as gyms.  It also includes offices and light industrial uses.  Therefore, this encompasses a very broad spectrum of uses.

Class MA.1(b) requires that any buildings that fall within Use Class E have been in that use for at least 2 years by the date of the Class MA application.

However, where there is doubt as to whether a use falls within Use Class E or some similar use instead, then the use of the property in Use Class E must be lawful as well as been in that use for 2 years by the date of the Class MA application.

Therefore, when assessing a property that looks as though it does not have planning permission for a Class E use, or where it has been operated in Use Class E in breach of a planning permission for another use outside of Class E, you will need to establish at least 10 years’ continuous use in Class E.  This timeframe is unaffected by the forthcoming Levelling Up and Regeneration Bill.

‘Non-Class E’ uses and Opportunity

Some types of uses are clearly distinguishable from other uses within Use Class E, but there are buildings that might be similar to Class E uses, depending on the actual functions and mix of activities taking place.  A few examples of this are listed below:

Non-Class E UseClass E Use
Warehouse/ ‘Wholesale’/ ‘Workshop’Offices/ Light Industrial
Car repairs and maintenanceCar Valeting and testing
Nail bars and tanning salonsNail bars and tanning salons

There are fine distinctions involved between the above uses, but if it can be accepted by the local planning authority that the premises falls into Use Class E, then this will significantly increase both the existing use value and the potential alternative use value of the premises.

Looking at the examples given above:

  • Pubs, as premises led mostly by the sale of alcohol on premises, contrast with restaurants, where the use is mostly based on table service and the sale of hot food for consumption on the premises with the sale of alcohol mostly incidental to a hot food menu.
  • Care should be taken with terms such as ‘wholesale’ and ‘workshop’, which can be interchangeable between light industrial (former B1(c), now Class E) use and B8 storage or distribution use. It is imperative to understand what the core functions of the business are on site.  Do the offices exist as an incidental or ‘support’ function to the B8 use, and what are the characteristics and frequency of traffic flows associated with the use?
  • Car repairs and maintenance often fall into either ‘sui generis’ or Class B2 (General Industrial) Use. This may be because of noise, vibration, smells, fumes, grit and disturbance from activities such as compressors, air tools, sanders, grinders and hammers: PINS Appeal: APP/Q1445/C/12/2169597.  By contrast, if there is so little of the use of such machinery and processes and the business relies more on valeting and occasional vehicle testing, for example, then this is more likely to fall into Use Class E, as power washers, cleaning, vacuuming, waxing and polishing are all more likely to be compatible with activities in a residential area.
  • Different local authorities vary over the application of nail bars and tanning studios to Use Class E, with some placing them outside Class E and in sui generis instead. However, such uses, depending on the chemicals, processes, fumes and impact on neighbours from the activities of the business, are capable of falling within Use Class E; PINS Appeal: APP/R5510/X/22/3290784.

Understanding ‘the planning unit’

Key to this assessment is understanding what is the ‘planning unit’.  The Use Class of a premises depends on what is the singular, self-contained independent entity in planning use.  A block of flats will comprise a planning unit in the case of each flat.  An office block will comprise a planning unit in the case of each office suite.

However, this can be more difficult to define where there are incidental or ancillary uses operating alongside the ‘dominant’ use of the planning unit.

The principal test and guidance in this area derives from the case of Burdle v Secretary of State for the Environment[1972].  Based on this, the local planning authority must consider the physical and functional relationship between different uses.

For example, in the case of a pub/restaurant, is the sale of alcohol a main use, or are people mostly coming to dine at the restaurant?  Is there a substantial kitchen not just for reheating food, but also preparing and cooking substantial meals?  Are most of the receipts of the business down to dining rather than the sale of alcohol?

In the case of ‘workshops’ and warehouses vis-à-vis offices, what proportion of the floor space comprises office use?  What are the functions of the staff employed on site?  What are the characteristics of traffic movements and deliveries to and from the site?

Early expert advice

There are many more ‘key indicators’ and important questions to ask in these circumstances and your planning consultant would normally have experience of the types of indicators that the local planning authority will look at and give weight to.  Therefore, this will involve an initial objective assessment, or fact-finding mission, which it is importantly to conduct thoroughly in order to build up a full picture.  It is important to seek early expert opinion regarding this, which will often be dictated by the unique facts on the ground.

It is dangerous and very risky to take a lazy ‘one size fits all’ approach to these questions as every case has to be determined on its own facts.  If an opportunity is too quickly dismissed, then an opportunity for planning gain may have been lost to somebody more willing to invest time and resources into this due diligence.  If one is too quick to adopt a site into Use Class E, then it may lead to a risk of substantial abortive costs further down the line, as well as wasted time and energy.

Certificates of Lawfulness of Existing Use or Development (CLEUDs)

There are essentially two main approaches to establishing the lawful use in the context of this planning gain-focussed strategy.

Firstly, there is a ‘phased approach’ of deliberately applying for a Certificate of Lawfulness for existing use (CLEUD) and then only applying for the prior approval to change the use to residential once this has been obtained.

The second approach, rather more risky, is to apply straight for the Class MA change of use and ‘roll-up’ within this application submissions that the use is lawfully within Use Class E.

The advantage to applying for a CLEUD first is that the local planning authority has less discretion to refuse the application, as long as it is sufficiently precise and unambiguous such that, on the balance of probabilities, the premises are ‘more likely than not’ within Use Class E.  Furthermore, the case officer might not sense an ulterior motive toward residential.  Therefore, the Class MA application might stand a better chance of success.

In addition, the issue of a CLEUD will immediately increase both the existing use value and potential alternative use value of the asset.

Where there has been a breach of planning condition or there is doubt as to the lawfulness of the current operations and proof of 10 years’ continuous use is necessary, it usually makes sense to try to establish this through the CLEUD route first.  Especially as the Council will only have 56 days to determine a Class MA prior approval application so that application should aim to be as straightforward as possible.  The more complexity is added to its assessment, the more likely that the Council will be motivated to refuse the application in order to avoid delay to it.

In order to effectively manage risk through the process and timescales, it is a good idea to obtain the CLEUD before exchange of contracts.

If an Article 4 Direction has been made, but is not yet in force, then there might not be enough time to obtain the CLEUD and then apply separately for the Class MA prior approval.  The former may have to be ‘rolled-up’ into the latter.  As above, programming and timescale considerations need to be discussed at an early stage with your planning consultant.

Obtaining a barrister’s legal opinion

A CLEUD application requires completed forms and a fee, plans and drawings of the existing premises, evidence and supporting facts and documents, and legal submissions.

Usually, it is also prudent to obtain Counsel’s Advice.  Such cases raise fine distinctions between uses and can also imply to officers important policy implications in granting a CLEUD that they might not be comfortable with, which could in turn affect their attitude toward accepting the evidence before them – not that it should do!  For instance, some cases might raise issues of the potential ‘loss’ of a valued ‘community asset’ such as a pub.

With regard to the enhanced EUV and potential AUV that comes with a successful CLEUD, there will normally be a cost-benefit advantage to instructing Counsel.  If Counsel cannot support the case, then time and other further expenses will have been saved.

Costs and Timescales

Your planning consultant will advise you of the likely costs and timescales involved.  However, a CLEUD application can take 8 weeks to determine (the officers might ask for more time depending on the evidence and their resources).  However, such cases can often take at least several weeks to a month to prepare, especially if key witnesses are unavailable or elusive.

You will incur professional fees for a CLEUD from your planning consultant, architect and possibly Counsel.

A Class MA application takes 56 days (8 weeks) to determine and will incur professional fees from the planning consultant, architect and other reports where required from experts, such as noise, traffic and natural light.  The preparation of this application can take place during the 8 weeks of the CLEUD application, if there is sufficient confidence that this will not be abortive (i.e. the CLEUD will be granted).

There may need to be discussion and advice taken on whether to submit a full planning application for external changes for new windows and other openings in order to optimise the Class MA application, for natural light purposes.  This will add to timescales and might depend on the structure of any deal with the vendor.  You might have to obtain a ‘lesser’ Class MA scheme first, complete on the deal, and then go back for full planning for new or more windows, then another Class MA application.  Again, watch out for any impending Article 4 Directions.