Converting commercial property to residential – investors warned to be wary

Converting commercial property to residential – investors warned to be wary

8:44 AM, 20th March 2023, About 11 months ago

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An industry body has issued caution on converting commercial properties into residential homes.

Propertymark has responded to an All-Party Parliamentary Group (APPG) inquiry about converting empty commercial property into affordable housing.

The organisation has warned of several obstacles to a wide-scale programme of conversions.

Converted properties need to meet high standards

Propertymark believes there is potential but has warned that converted properties would need to meet high standards.

The industry body said this will help prevent poor conversions that do not provide an adequate standard of living.

Henry Griffith, the policy and campaigns officer at Propertymark, said: “Commercial properties are incredibly varied and often require substantial work in order to be suitable for residential housing.

“Conversions must be made with the proper regard for the quality of living and suitability of the conversion, or we would risk the creation of low-standard housing and isolated communities when there are alternative measures to increase housing supply.”

Lack of clarity within the planning system dealing with conversions

There is concern that many commercial properties would be unsuitable for residential conversion and too costly to modify.

Propertymark members are concerned at the lack of clarity within the planning system dealing with conversions.

The industry body would like to see more clear guidance to planning authorities allowing for conversions on a national scale.

Also, the location of many commercial properties is too isolated and unsuitable for community needs, according to Propertymark. In addition, developers would have to consider the conversions to be profitable.

Mr Griffith added: “Propertymark has long advocated for a range of measures to improve the housing supply crisis and very much welcomes this joint inquiry to explore converting commercial property as a potential solution.

“There are certainly instances when conversions can be suitable, however, we have made it clear in our response that the suitability of the property for conversion must be reviewed on a case-by-case basis.”

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