September 4, 2013 11:47 am

House Rules: property law and business improvement districts

How BIDs can boost local economies, and government proposals to relax ‘change of use’ rules
©James Ferguson

1. On a high street in the UK near you . . .

There’s a BID in my neighbourhood. What does that mean? BID is short for business improvement district. A BID is a body led by local businesses that aims to promote the local economy by improving the area. Often they form when companies step in to provide services that councils are cutting.

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Is this a new idea? No. The BID model started decades ago in Canada and the US and has been taken up in a number of other countries too, including South Africa, New Zealand and Germany. They are relatively new to the UK, although there are already more than 170 BIDs – and the number is growing. A BID typically covers a high street or town centre. Under the arrangement, which was made possible in 2004, if a majority of businesses in an area vote to join the BID, then all are compelled to by law. The Baker Street BID is an example of a recent success story in London. The area has been rebranded the Baker Street Quarter.

What changes will I see on my high street? That is up to your local BID. The aim is to create an attractive environment, where people want to come and spend their money. The BID might focus on measures to reduce crime, making people feel safer. It might improve transport links. Some BIDs run marketing campaigns to put the area on the map. As well as creating a better place to shop, work and play, a thriving local centre could ultimately boost the value of your home.

Is this all paid for out of my council tax? No. A business in a BID will pay a small extra levy on top of its normal business rate. The funds are used to supplement, not replace, existing local authority services. None of the money goes to central government.

I’m a landlord of commercial premises. Will a BID cost me money and do I have a say? At present, landlords are excluded so long as the property remains let. Some make voluntary contributions, working with their business tenants to make BIDs work. The government is considering how landlords can be included formally in the BID regime, as they are in other parts of the world. The consultation is open until September 17.

2. Planning permission

More residential conversions? The UK government wants to make it easier to convert buildings to homes without planning permission. In many areas of England a liberalised regime for converting former office buildings has been in place since May 30. A consultation paper published on August 6 proposes allowing conversions from retail and agricultural buildings without planning permission.

Will it be a free-for-all? No. The local authority would have no say over the principle of the proposed conversion but would need to give prior approval that specified detailed elements of the project had been satisfactorily addressed. The right would not apply in conservation areas and other areas with specific statutory protection.

What criteria are proposed for converting a shop into a home? The right would apply to shops, as well as banks and building society premises, measuring up to 150 sq metres. Conversion would be allowed to up to four flats, together with any necessary external modifications. Prior approval would be required from the local authority in relation to design and potential impact on the “economic health” of the town and city centre. This is a big political issue and the government needs to ensure that initiatives such as BIDs (see above) are not undermined by large-scale conversion to residential. The government is seeking views on how it should define the “economic health” test.

I live in a rural village. What rules are proposed for converting agricultural buildings? Agricultural buildings constructed before March 20, even those in conservation and protected areas, are allowed to be converted to create up to three additional dwellings. The local authority would first have to approve the site and design of the conversions and any impact on transport and highways, noise, contamination and flooding.

SJ Berwin is an international law firm. This column is written by Rachel Burns, a solicitor in its London office.

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