Repurposing Commercial Buildings: A Consultancy View

Repurposing a commercial building means changing what it is used for, most often an old office or a tired shop becoming flats. In England you can often do it under a permitted development right called Class MA, without a full planning application. But the right only opens the door. Whether the building can actually take homes is a separate question, and that is the one that decides whether the scheme makes any money.

Two different tests, then, one legal and one physical.

We look at these schemes from the money side, usually for a developer, a bank or an investor weighing up a town-centre building around Stockport and the wider North West. The permitted development headline makes conversion sound like a shortcut, and for the right building it can be. For a deep 1970s office floorplate it often is not, and the gap between those two outcomes is where an appraisal quietly falls apart. So here is how we actually read one of these buildings before anyone commits.

Can I convert an office or shop to flats without planning permission?

Often, yes, through Class MA. Since 5 March 2024 the two conditions that used to catch people were removed: there is no longer a 1,500 square metre floorspace cap, and the building no longer has to have sat empty for three months first. The main test now is that the building was in commercial use, Use Class E, which covers offices, shops, gyms, nurseries and clinics, for at least 2 years before you apply.

Class MA is not planning permission. It is prior approval, which means you apply to the council on a shorter list of matters and they have 56 days to decide. Let no deadline slip and the consent can be deemed granted. The matters they can refuse on include flooding, contamination, noise, and the one that sinks most office conversions, natural light to every habitable room. Since April 2021 the flats also have to meet the Nationally Described Space Standards, so a one-bed, one-person flat cannot be smaller than 37 square metres. You cannot slice a floorplate into rabbit hutches any more.

Two Stockport warnings before you bank on any of this. Listed buildings are excluded from Class MA outright, and a good deal of the older stock around Underbank and the Market Place sits inside a conservation area, where the right is narrower and the council may have an Article 4 direction switching it off entirely. Check the designation before you pay for a survey, not after.

Will the building actually take homes?

This is the test that costs money, and it has nothing to do with planning. Offices are built deep, because a trading floor does not care whether the middle of the plan sees daylight. Homes do. A habitable room needs a window, and daylight only reaches so far into a room, realistically about 6 to 7 metres from the glass. On a deep 1960s or 1970s floorplate that leaves a dead band down the middle of every floor that can never be a bedroom or a living room.

So the real question is how much of each floor becomes saleable flat and how much becomes corridor, lift, stair, riser and store. We call that the net to gross ratio, and on a conversion it is almost always worse than a developer's first sketch assumes.

An honest one from our side. We monitored a town-centre conversion where the appraisal had the whole floorplate turning into flats. The daylight assessment failed across the core, and a large slice of every floor ended up as circulation and cycle stores. The scheme still stacked up, just about, but the net saleable area landed well below the first drawing, and the developer had already agreed a price on the strength of that drawing. Catching that gap before the loan drew down is precisely what a monitoring surveyor is paid to do.

Height brings its own rule. If the finished building is at least 18 metres tall or has 7 or more storeys, it is a higher-risk building under the Building Safety Act 2022, and the whole design passes through the Building Safety Regulator's gateway regime. That is months, not weeks, and it changes the programme completely.

Class MA prior approval or a full planning application?

Prior approval is faster and gives the council fewer grounds to say no. That is its only real advantage. A full planning application is slower and less certain, but it lets you change the outside of the building, add storeys, alter the footprint and argue the scheme on its merits. For anything larger than a small block, we often steer clients toward full planning, because a conversion worth doing usually wants more than the inside rearranged.

Neither route is a shortcut on its own. The right one falls out of the building, not out of a preference.

What does it cost, and where does the money leak?

Conversion has one genuine tax advantage worth knowing. Turning a non-residential building into dwellings is charged at the reduced 5% rate of VAT on most of the construction work, not the standard 20%, under section 7 of VAT Notice 708. On a seven-figure build that is real money, and it is missed more often than you would think, because the contractor bills at 20% out of habit and nobody queries it.

The leaks sit elsewhere. Old commercial buildings hide asbestos, so anything built before 2000 needs a refurbishment and demolition survey before you touch it. Floor-to-floor heights that suited an office get tight once you add acoustic separation and new services between flats. Every drainage stack, every riser, every run of ventilation has to be threaded through a frame that was never drawn for it. And a commercial building you plan to keep letting in the meantime still has to hold an EPC of at least E to be let lawfully, which can force spend before the conversion even starts.

None of this kills a scheme. It just has to be in the number on day one, priced by someone who has stripped one of these buildings back before, rather than discovered late by the site team.

Is repurposing right for your building?

Start with two checks. Is the building legally eligible, Class E for 2 years, not listed, not switched off by an Article 4 direction? And will daylight and floor depth let enough of it become homes to pay for the work? Get honest answers to both before you exchange, because everything after that is detail.

We do this work every week across Stockport and the North West. Our property and development consultancy team runs the eligibility and feasibility, our quantity surveyors put a real number on the conversion including the VAT position, and we hold the whole thing together with construction project management on site. If a lender is funding it, our fund monitoring team checks the appraisal survives contact with the actual building. If you have a commercial building you are thinking of repurposing, tell us about it and we will give you a straight answer on whether it works.