When selling a commercial property, the use classes and planning permission attached to the property can affect your sale options. Use our guide to find out more information on the subject.
Commercial properties are covered by The Town and Country Planning (Use Classes) Order 1987, which covers the uses of business premises and land and divides them into different categories.
Please see the table below, indicating the use class types and how they can be utilised.
| A1: Shops | A2: Financial and Professional Services | A3: Restaurants and Cafes |
| A4: Drinking Establishments | A5: Hot Food Takeaways | |
| B1: Businesses | B2: General Industrial | B8: Storage and Distribution |
| C1: Hotels | C2: Residential Institutions | C2A: Secure Residential Institutions |
| C3: Dwelling Houses | C4: Houses in Multiple Occupation | |
| D1: Non-Residential Institutions | D2: Assembly and Leisure | Sui Generis |
| B3 – B7: Special Industrial Group A – E |
*Contains public sector information licensed under the Open Government Licence (Updated 08 February 2017)
You should also be aware that in some cases, the use of a commercial property can be altered without reference to the local authority – i.e. from B2 general industrial to B1 businesses, whereas A2 financial and professional services to A3 restaurant and cafes use is not automatic. Please see below the comprehensive list of changes of use that do not require planning permission.
| From | To |
|---|---|
| A1: Shops | A2: Financial and Professional Services A3: Restaurants and Cafes (subject to prior approval) C3: Dwelling Houses (subject to prior approval) D2: Assembly and Leisure (subject to prior approval) |
| A2: Financial and Professional Services (when properties have a display window at ground level) | A1: Shops A3: Restaurants and Cafes (subject to prior approval) C3: Dwelling Houses (subject to prior approval) D2: Assembly and Leisure (subject to prior approval) |
| A3: Restaurant and Cafes | A1: Shops A2: Financial and Professional Services |
| A4: Drinking Establishments | A1: Shops A2: Financial and Professional Services A3: Restaurants and Cafes |
| A5: Hot Takeaways | A1: Shops A2: Financial and Professional Services A3: Restaurants and Cafes |
| B1: Businesses (less than 235 sq m of floor space) | B8: Storage and Distribution |
| B2: General Industrial | B1: Businesses |
| B2: General Industrial (less than 235 sq m of floor space) | B8: Storage and Distribution |
| B8: Storage and Distribution (less than 235 sq m of floor space) | B1: Businesses |
| C3: Dwelling Houses | C4: Houses in Multiple Location |
| C4: Houses in Multiple Location | C3: Dwelling Houses |
| Sui Generis: Casinos | D2: Assembly and Leisure A3: Restaurant and Cafes (subject to prior approval) |
| Sui Generis: Betting Shops and Payday Loan Shops | A1: Shops A2: Financial and Professional Services C3: Dwelling Houses (subject to prior approval) |
| Sui Generis: Agricultural Premises | A1: Shops A2: Financial and Professional Services A3: Restaurant and Cafes B1: Businesses B8: Storage and Distribution C1: Hotels C3: Dwelling Houses (subject to prior approval) D2: Assembly and Leisure (subject to prior approval) |
*Contains public sector information licensed under the Open Government Licence (Updated 08 February 2017)
This is not a definitive list. Careful research should be carried out and you should seek professional advice regarding the intended use.
Please see the table below, showing what types of use falls within each category.
| A1: Shops | Shops, retail warehouses, hairdressers, undertakers, travel and ticket agencies, post office (not sorting offices), pet shops, sandwich bars, showrooms, domestic hire shops, dry cleaners, funeral directors and Internet cafes |
| A2: Financial and Professional Services | Financial Services such as banks and building societies, estate and employment agencies, professional services (other than health services, pay day loan and betting shops) |
| A3: Restaurants and Cafes | For the sale of food and drink for consumption on the premises – restaurants, snack bars and cafes |
| A4: Drinking Establishments | Public houses, wine bars or other drinking establishments (but not night clubs). |
| A5: Hot Food Takeaways | For the sale of hot food for consumption off the premises |
| B1: Businesses | Offices (other than those fall within A2 use), Research and development of products and processes, Light industry appropriate in a residential area |
| B2: General Industrial | Use for industrial process other than those fall within class B1 (excluding incineration purposes, chemical treatment or landfill or hazardous waste) |
| B8: Storage or Distribution | Including open air storage. |
| C1: Hotels | Hotels, boarding and guest houses where no significant element of care is provided (excludes hostels). |
| C2: Residential Institutions | Residential care homes, hospitals, nursing homes, boarding schools, residential colleges and training centres. |
| C2A: Secure Residential Institutions | Use for a provision of secure residential accommodation, including use as a prison, young offenders institution, detention centre, secure training centre, custody centre, short term holding centre, secure hospital, secure local authority accommodation or use as a military barracks. |
| C3: Dwelling Houses | This class is formed of 3 parts: C3(a) covers use by a single person or a family (a couple whether married or not, a person related to one another with members of the family of one of the couple to be treated as members of the family of the other), an employer and certain domestic employees (such as an au pair, nanny, nurse, governess, servant, chauffeur, gardener, secretary and personal assistant), a carer and the person receiving the care and a foster parent and foster child. C3(b): up to six people living together as a single household and receiving care e.g. supported housing schemes such as those for people with learning disabilities or mental health problems. C3(c) allows for groups of people (up to six) living together as a single household. This allows for those groupings that do not fall within the C4 HMO definition, but which fell within the previous C3 use class, to be provided for i.e. a small religious community may fall into this section as could a homeowner who is living with a lodger. |
| C4: Houses in Multiple Occupation | Small shared dwelling houses occupied by between three and six unrelated individuals, as their only or main residence, who share basic amenities such as a kitchen or bathroom. |
| D1: Non-Residential Institutions | Clinics, health centres, crèches, day nurseries, day centres, schools, art galleries (other than for sale or hire), museums, libraries, halls, places of worship, church halls, law court. Non residential education and training centres. |
| D2: Assembly and Leisure | Cinemas, music and concert halls, bingo and dance halls (but not night clubs), swimming baths, skating rinks, gymnasiums or area for indoor or outdoor sports and recreations (except for motor sports, or where firearms are used). |
| Sui Generis | Certain uses do not fall within any use class and are considered ‘sui generis’. Such uses include: theatres, houses in multiple occupation, hostels providing no significant element of care, scrap yards. Petrol filling stations and shops selling and/or displaying motor vehicles. Retail warehouse clubs, nightclubs, launderettes, taxi businesses, amusement centres and casinos. Betting shops and Payday loan shops. |
*Contains public sector information licensed under the Open Government Licence (Updated 08 February 2017)
Whether the property has planning permission should be stated in the ‘Heads Of Terms’ (HOTS) for avoidance of any doubt. If the property is without planning permission for the buyer’s intended use and the class use cannot be altered within the framework, then a formal planning application will be required. This can be a long process and will usually take at least eight weeks, but be aware this period could be considerably extended.
It may be worth offering information relating to any planning permission that your commercial property already has. This will save a lot of time, effort and money for the buyer. This may well result in your commercial property being more attractive to a potential buyer.
Planning is a complex field, which requires specialist knowledge. A change of use application is relatively straight forward. However, if you are making either a formal application for change of use or seeking a completely fresh planning permission, then there may be certain elements that require professional experts in such areas as, road traffic assessments, ground investigations reports etc.
Contacting your local authority is a logical first step but you should bear in mind that local authorities can be extremely difficult to reach ‘over the counter’ or by telephone.
Click here to find your local authority contact details.
If you are planning any major changes to the business property, you will almost certainly need the services of the following professionals:
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