Commercial-to-Residential? UK Towns and Cities Post-COVID

People looking to get into property investment will be rightly aware of the current circumstances involving COVID-19 and how it has changed the business landscape over the last 12 months. Plans may have changed for both property investors and developers due to financial difficulties, but with these difficult times comes innovation.  Everyone is wondering whether our towns and cities will see more commercial-to-residential conversions in a post-COVID world?

Taking a walk through the local town or city centre may result in shock for some due to the sheer amount of bare, empty premises where popular retail outfits once stood. Property investors across the UK should note that this has been the case for several years now due to the widespread rise of internet shopping. Just in 2017, a total of 6,000 shops closed – during that time, it was the highest amount in a year since 2010. Since then, the high street has only continued to suffer with nearly 14% of all UK shops now lying vacant. COVID-19 has only accelerated the inevitable jump to online shopping and encouraged property investors to turn to commercial-to-residential projects.

The question of whether Housing is the Future of the High Streets, however, has been asked many times before, even before the pandemic. Looking at the facts and the current global situation, many will be inclined to say yes. Making use of these empty lots with commercial-to-residential development will only result in benefits for everyone involved – those in the UK property market, cities and towns, and those who live there.

In August of last year, new development rights were introduced to replace purpose-built detached blocks of flats, offices and light industrial premises with purpose-built detached buildings for use as flats or a single dwelling house. The construction of new homes on top of purpose-built detached blocks of flats was also introduced. This all essentially means that the likes of restaurants and retail outfits can benefit from converting their spaces into residential use, with retailers such as John Lewis taking advantage of the new rights.

Therefore, build-to-rent property investors could benefit themselves in the future due to these radical changes the government is currently making. BTR properties incorporated into the now empty high street stores should result in more aesthetically pleasing city centres, where fewer vacant lots exist, and more wasted space is utilised. On the other hand, though, some developers and architects such as British Property Federation (BPF) and London First have said that these proposals are a “threat to the high street,” where there would be “significant adverse consequences” as well as an exacerbation in “the decline of our high streets, far outweighing any positive contribution to new housing supply.”

Although there are disadvantages to the government’s plans, the retail industry is heading to an online future, suggesting that our towns and cities need to be utilised for other purposes. With the flexibility of these plans the government is introducing, there is some hope that our towns and cities are once again restored to their former glory.

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