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Real Estate Update: Opportunities for Residential Development in Vacant Commercial Premises?

08 June 2018

New planning and development regulations (SI 30 of 2018) were introduced in February 2018 as part of the Rebuilding Ireland Action Plan. These regulations extended the categories of exempted development under the Irish Planning Acts. This includes the conversion of upper floors of vacant commercial properties in urban areas to residential accommodation. It is hoped that these measures will help to address the housing shortage and deliver more residential units in a shorter timeframe.

The category of exempted development has been extended under the Regulations to include a habitable room used for living or sleeping purposes. This does not include a kitchen that has a floor area of less than 6.5 square metres.

The Regulations allow for development consisting of the change of use, and any related works, from an existing specified class of use to residential use, in certain circumstances and subject to certain conditions and limitations.

Qualifying criteria

Classes of commercial premises that can benefit from this exemption include:

  • Premises with existing planning permission for use as a shop
  • Premises with existing planning permission for professional services or financial advisors, including betting shops
  • Premises with existing planning permission for use as an office
  • Premises with existing planning permission for use as a guesthouse or hostel

The Regulations specifically exclude warehouses and buildings for light industrial use.

Conditions and limitations

For a property to qualify for the exemption it must fall within the listed classes and have been vacant for two years prior to the date of commencement of works. The proposed development is then subject to the following conditions:

  • Works should be to the interior only and not materially change the external appearance. Where alteration work is carried out on the existing ground floor shop fronts, it must be consistent with the character of the rest of the building and of neighbouring buildings.
  • Ground floor works must comply with the relevant local authority development plan.
  • The development is restricted to no more than nine residential units per property.
  • The units shall comply with minimum floor area requirements and minimum storage requirements, as per updated guidelines ‘Sustainable Urban Housing’, March 2018.
  • Habitable rooms must have adequate natural light.

Works to protected structures are not permitted save in limited circumstances. Similarly, works will not be permitted if the property is in an area of special amenity or special planning control.

The relevant local authority must be notified in writing two weeks prior to the commencement of change of use and any related works. This notification will identify the property, outline the number of residential units involved and confirm the size of the unit and number of bedrooms. All works must be completed before 31 December 2021.

Conclusion

The Regulations provide a mechanism for fast and effective conversion of existing vacant commercial units to residential use. It provides an interesting prospect for investors looking for small-scale residential development opportunities in prime locations.

Potential drawbacks to the Regulations include limiting the number of units to nine per building and the exclusion of warehouses or buildings used for light industrial purposes.

It remains to be seen what the uptake will be from owners and investors. The Irish Government will collate the data on the number of notifications under the Regulations from local authorities in 2019. This will show what impact the Regulations have in solving the current housing shortage.

For more information on effective change of use under the Regulations, contact a member of our Real Estate team.


The content of this article is provided for information purposes only and does not constitute legal or other advice.

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