New Permitted Development (“PD”) rights to change from Class E to residential use

England and Wales

The Government has confirmed that it will introduce a new PD right to allow the change of use from commercial, business and service uses (Class E) to residential uses (Class C3) in England.  This PD right, under Class MA, will come into force in August 2021 and draft legislation, the Town and Country Planning (General Permitted Development etc.) (England) (Amendment) Order 2021 was laid before Parliament on 31 March 2021.

Coming quickly after the radical creation of the new Class E, and following a consultation that expired in January 2021, this would be the most significant extension to the creation and delivery of new homes through PD rights. Landlords, considering their options in a post-Covid world, could have another use option available to them.

In our last Law-Now, we commented on the lack of constraints that the Government was intending to include on this new PD right. Following the consultation, the Government has introduced three significant constraints on this PD right. These are a: 1) size limit of 1,500sqm of floorspace changing use; 2) requirement that the floorspace changing use has been in a commercial, business and/or service use for the two years prior to the application; and 3) requirement that the floorspace changing use has been vacant for three months prior to the application.

Increased flexibility

The Prime Minister’s ‘Build, Build, Build’ statement last June promised that a wider range of commercial buildings would be allowed to change to residential use without the need for a planning application, with this consultation representing a step towards fulfilling this aim. Current PD rights already provide for retail, financial and professional services, and offices to change to residential use, and these rights will continue to apply until 31 July 2021. The current and proposed PD rights will then be drawn together into a single PD right which will provide for the change of use from any commercial, business and service use to residential.

The new Class E, introduced from 1 September 2020, introduced flexibility into changes of use by grouping together commercial, business and service uses and allowing change between these uses without a planning application. The extension to PD rights will provide further flexibility by allowing uses within Class E to change to residential use. When these new PD rights take effect, then restaurants, medical facilities, creches, gyms and indoor sports facilities will all be able to change to residential use without a planning application.

The standard restrictions on the application of PD rights that apply to EIA development will apply. These rights will apply in conservation areas, unlike many existing PD rights governing a change of use to residential, although the proposed right would require prior approval of the impact of the loss of the ground floor use to residential in conservation areas.


The newly introduced size limit, the requirement for the floorspace to have been in a commercial, business and/or service use for the two years prior to the application and the need for the floorspace changing use to have been vacant for three months prior to the application are significant new constraints that do not currently apply to the corresponding PD right. The two year requirement was introduced to prevent “gaming” of the planning system. However, Landlords may be happy to leave units vacant for three months (or serve break notices to create the vacancy) and take the pain of lost rent for a short period to enable the new right to be engaged. There would appear to be nothing in the proposed legislation to prevent this.

As with all PD rights, other regulations such as Environmental Impact Assessment and Habitats Regulations would apply.

All new homes would be also required to meet the new quality requirements, which require that all new homes delivered under PD rights meet the nationally described space standards and provide for adequate natural light.

Prior approvals process

The proposed prior approvals are similar to other PD rights for the change of use to residential. The proposed matters that require prior approval are:

  • transport impacts of the development, particularly to ensure safe site access;

  • contamination risks in relation to the building;

  • flooding risks in relation to the building;

  • impacts of noise from commercial premises on the intended occupiers of the development;

  • where

    • the building is located in a conservation area; and 

    • the development involves a change of use of the whole or part of the ground floor,

    the impact of that change of use on the character or sustainability of the conservation area;

  • the provision of adequate natural light in all habitable rooms of the dwellinghouses;

  • the impact on intended occupiers of the development of the introduction of residential use in an area the authority considers to be important for general or heavy industry, waste management, storage and distribution, or a mix of such uses; and

  • where the development involves the loss of services provided by a:

    • registered nursery; or

    • health centre maintained under section 2 or 3 of the National Health Service Act 2006,

    the impact on the local provision of the type of services lost.

In addition, developers will need to submit a floor plan showing the total floor space in square metres of each dwellinghouse. This will be subject to the space standards requirements.

The amended proposals appear to close off the option of large-scale housing development being consented via the new PD right, given the 1500sqm ceiling. So the repurposing of large - and potentially struggling - retail assets such as out of town retail is off the table but (subject to prior approval) it could be open season for the picking off of individual retail units on the high street. In terms of prior approval, the noise requirement is likely to be the key weapon for local planning authorities in opposing any high street residential conversions.


The proposals include a carve out for areas of outstanding natural beauty, the Broads, national parks, areas specified by the Secretary of State for the purposes of section 41(3) of the Wildlife and Countryside Act 1981, and World Heritage Sites. The usual exclusions to PD rights would also continue to apply for sites of special scientific interest; listed buildings and land within their curtilage; sites that are or contain scheduled monuments; safety hazard areas; military explosives storage areas and sites subject to an agricultural tenancy.