Warehouse planning by appeal warn property industry pundits
At the launch of the British Property Federation and Savills’s latest research Industrial & Logistics: The Infrastructure of Everything, yesterday morning, invited panellists noted that despite governmental moves to make planning simpler and more efficient for I&L facilities through its revamped planning bill, bigger schemes were more likely to come forward through the appeal process rather than via local planning authorities.
By Liza Helps, Property Editor, Logistics Matters
DESPITE THE latest National Planning Policy Framework (NPPF) actively supporting the development of industrial and logistics facilities, the practicalities of implementation mean that developers/investors who may want to secure ‘planning by partnership’ will in effect ‘be made to be the aggressor’ meaning they will have to prove there is demand for warehousing space especially where there is not an allocation in the Local Plan for a particular site – pretty much as it is now.
At present planning policy does not fully recognise the importance of I&L space to the economy. There is no requirement for planning authorities to set targets for employment uses as they do with housing, meaning insufficient land is allocated in the right locations.
According to the report the planning system has restricted development of modern industrial space for past decade and ‘suppressed’ demand, economic output and employment.
This historic undersupply of industrial space across the UK has artificially suppressed demand and cost the nation more than 140,000 jobs and £9.7bn in economic output (GVA) – roughly the same economic output as a mid-sized city – since 2010.
The availability rate for industrial and logistics space has been below 8% – the ‘healthy’ rate at which supply and demand is broadly in balance – for well over a decade (2010 – 2024), preventing businesses from accessing the workspace they need to thrive and grow.”
According to the analysis, demand would have been 37% higher over the period 2010 to 2024, if supply had kept pace.
Savills head of London Economics Mark Powney said: “By analysing ‘suppressed demand’ we can quantify for the first time the economic cost of the long-term undersupply of industrial workspace.
“If companies cannot access the space they need in the right locations, expansion plans become unviable and fewer employment opportunities are created. The loss of 140,000 potential jobs is significant at a time when unemployment and economic inactivity are high, and there is an need to create alternative routes into employment for young people in particular.”
During the panel discussion at the report launch Powney added that until planning authorities were made to set targets for employment use in a similar way to housing the government would find it difficult to unblock the planning system.
“The UK is a very investable country but we don’t have a fit for purpose planning system. There seems to be a culture whereby growth is not seen as a positive [especially when it comes to industrial and logistics development].”
He added that currently Local Authority estimates of employment demand at best tended to look backwards at what was taken up in the past to inform future demand rather using scientific methodologies to calculate supressed demand for what is needed now or in the future.
“While the new NPPF is better than its predecessor until there is Planning Practice Guidance pushing for employment use targets in a similar way to housing targets, it will not work.”
As well as the lack of a robust PPG, holding back governmental plans with its new NPPF, the fact that many Local Plans are out of date or unfinished compounds the problem. If that were not enough, a lack of planning officers and investment in the practical planning system of many Local Authorities means that a mere 18% of major planning applications are dealt with in the statutory time frame and 24% take longer than a year.
This is particularly important for economic growth in the UK as industrial and logistics underpins all eight business sectors that the Government has identified in its latest Industrial Strategy.
Industrial and logistics has grown 29% since 2010 the fastest business sector growth in the UK. It supports 4.5 million jobs and some £287 billion – 13% GDP generating £84.4 billion in tax.
For every 10 jobs on site the I&L sector creates a further 10 off site where retail only secures a further five off site and offices six off site.
It is the infrastructure of everything.
