The heavily publicised Growth and Infrastructure Bill received Royal Assent on 25 April and amends existing legislation in relation to residential planning so as to encourage development. In the following article, we revisit the opposition to lease renewals under Ground (F) of the 1954 Act in light of the Growth and Infrastructure Act.

These changes include:

  1. A right for developers to appeal directly to the Planning Inspectorate to modify planning obligations that the developer considers make schemes for development unviable. In particular, developers can to make formal requests to alter or discharge affordable housing obligations in section 106 agreements so as to ensure developments are viable.
  2. Widening permitted development rights so as to allow offices to be redeveloped for residential use. The following link shows the areas which are exempt from the relaxation of the permitted development rights – https://www.gov.uk/government/publications/ areas-exempt-from-office-to-residential-change-of-use-permitted-development-right-2013
  3. Allowing a developer to apply for planning consent directly from the Planning Inspectorate, where a council has 'consistently failed to meet statutory requirements to consider applications on time.'

Whilst these measures encourage residential development there is often still the issue of terminating existing commercial tenancies prior to redevelopment. This is not a problem where the existing tenancies are contracted out of the Landlord and Tenant Act 1954 (the Act) and where the lease contains a break clause allowing the landlord to terminate the tenancy. However, where the tenancies are not contracted out of the Act (in the absence of the tenant agreeing to vacate) it is necessary for the landlord to oppose the tenant's statutory right for a lease renewal under the grounds specified in the Act.

For the redevelopment of office buildings to residential buildings it is likely that the landlord will rely on Ground (F) to oppose the lease renewal.

Summary

Ground (F) provides that the landlord must prove their intention to demolish or reconstruct the premises or a substantial part of the premises. There are many matters which assist with proving this intention, for instance building contracts and proof of financing, however in the majority of cases the sticking point is with regards to planning. With the new planning regime in place, it is thought that the Landlord's ability will become more straightforward.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.