The rights allow developers to turn abandoned buildings, such as offices and pubs, into residential units, but the legislation – first written in May 2013 – was only made permanent on 6 April as a result of the amendment to the General Permitted Development Order.
Adrian Dadds, director of independent funding specialists, St. George’s Finance, said that finance for this type of development will be more widely available now.
“More lenders are offering PDR finance now – a lot were comfortable with it before but, because there was a concern that developers wouldn’t have completed the conversion to residential units before the rights expired, they were a bit more cautious about it,” said Dadds.
“Having it more formalised makes our clients happier; lenders will always operate on a worst-case-scenario basis.
“PDR is all about buying the right property at the right price – there is great value to be had from buying old office units and converting them to residential, although an increasing number of vendors are aware of this now so prices are starting to come up.”
He said that, with residential property prices at a premium in London, the Capital is expected to be a target for much of this sort of development.
“There is a lot of demand for commercial property to be turned into resi’ in London, as you would expect”, he added.
“We recently completed an office building conversion into 21 flats in west London.”
He said that lenders are far more likely to provide PDR finance to experienced developers with a professional team around them.