Quite often when we think of regeneration, we think of large-scale developments which involve demolition of existing buildings to be replaced by new ones. However, what is often overlooked is repurpose regeneration.
Repurpose regeneration - what is it?
Repurpose regeneration is the reuse and repurposing of existing assets. This occurs where assets are becoming redundant but are often in both a good location and remain in good useable condition. Accordingly, there is a real opportunity to breathe new life into such assets without incurring the significant costs associated with other types of regeneration.
It is very common for local authorities to hold ownership of town centre and high street properties. These may be dedicated retail units, mixed-use blocks that also contain housing or part of a wider portfolio of leisure/culture venues and other assets. Effective asset management in this way can play a major role in delivering better outcomes for residents, creating a sense of place and community. As such, repurpose regeneration provides a real opportunity for local authorities to do more with less.
For investors and corporates, repurpose regeneration is a means by which to demonstrate commitment to environmental, social and governance (ESG) values and goals. However, while acknowledging the importance of the ESG agenda on projects, and that purely financial metrics are only one aspect of a project, generally investors are unlikely to provide their support for any repurpose regeneration project without being presented with a positive financial business case.
What does a landowner need to consider?
- When starting any repurposing project, it is important to carry out due diligence to ascertain what legal and practical issues that need to be taken into consideration.
- Title - are there any restrictions on the legal title?
- planning - is an alternative use permitted under the existing planning permission? Is there an opportunity to swap between uses? Are there opportunities to use permitted development rights to introduce other uses or carry out alterations works without the need for planning permission?
- environmental - is environmental remediation needed?
- understanding the locality – quite often engagement with the local community regarding proposed uses generates ideas that may not have been considered by the landowner. Affordable workspaces and multi-use spaces for example are supported because of the value they deliver for local communities and for their role in catalysing further local investment and development
on the ground - is digital infrastructure needed, is the building access suitable, are health and safety works needed (fire engineering etc)? - technology - are there technical updates that can be made to assist with on-going maintenance, utility, and usage costs? Is there is a need for futureproofing in terms of smart units, data capture technology or enhanced fibre/wireless connectivity?
- local authority priorities - whilst adherence to procurement and fiscal objectives are key for the public sector, there will also be a need to consider wider issues in terms of social value and community-based outcomes. All local authorities should have their public sector equality duty at the forefront any regeneration proposals.
- construction - consider whether the regeneration project can be used as an opportunity to improve the ESG performance of the asset, by introducing green technologies such as solar panels, led lights, rainwater harvesting facilities etc.
- funding¬ - is there any central government funding or 'green finance' available to support the project?
- tax - any repurpose project would need specific tax advice
Repurpose regeneration presents an exciting opportunity for local authorities to unlock sites and it is recommended that advice is obtained at the earliest opportunity on local authority legal and governance obligations.
Rita Bange is a Senior Associate at Trowers & Hamlins.