Real Estate Investors plc (REI), the UK’s only Birmingham-based, Midlands-focused property REIT, has welcomed new rules that came into effect on 31 March which permit commercial properties to be converted for residential use.
The government hopes that the new rules, announced by Housing Secretary Robert Jenrick, which allow unused commercial premises to be transformed into homes, will encourage more people to live in their local high streets.
Paul Bassi, chief executive of REI, said: “These changes are a positive step forward and demonstrate that the government is willing to make the necessary changes required to reinvent our high streets.
“The relaxation of the planning rules, allowing unused commercial buildings to be converted to residential, combined with the Class E rule changes announced in Autumn 2020, will have a material impact on our business, allowing us to capitalise on eligible void space within our portfolio, while attracting tenants that we wouldn’t have otherwise attracted to our vacant spaces.
“We are seeing increased demand for retail property among experienced investors, particularly neighbourhood and convenience retail, with pricing being achieved at pre-Covid levels at auction.
“We expect the benefit of these changes to be felt on high streets that are in urgent need of revitalisation after years of negative retail sentiment, followed by a challenging 12 months during the pandemic.”
He added that the Midlands in particular, with the arrival of the vast HS2 infrastructure improvements on the horizon and the highly-anticipated Commonwealth Games in 2022, is very well placed to benefit from these positive changes as a region that already offers a strong local economy, unrivalled industry opportunities, excellent housing and schools, and imminent world class transport links.
“This may be the final encouragement needed for families and professionals who are considering basing themselves and their businesses in an emerging region and this will no doubt lead to even further population migration from the capital over time,” he said.
The changes mean that proposals for new homes in commercial properties will go through a simpler prior approval process instead of a full planning application.
The focus will be on high streets, unused buildings and brownfield lands in cities and towns.