On 16 January 2021, the Government announced a new ‘Right to Regenerate.’ The right is aimed at making it easier for developers to develop vacant, void, or derelict buildings, by transferring land which is currently in public ownership. We examine the proposal and its impact on developers and providers of affordable housing.

How it works

An interested party would make an application to the council or public authority, requesting to buy the land for development. If the council or public authority cannot provide future plans for the land, the applicant will be able to purchase the land at market value. The scheme aims to release land currently held by councils and other public authorities, which would otherwise be held onto and undeveloped.

The right will apply to land which is held in public ownership, such as councils and other public bodies. Controversially, the right also applies to unused social housing and garages currently owned by councils, which are estimated at 25,000 and 100,000 sites respectively. It is unclear at present whether this will be extended to cover small bodies, such as parish councils.

Why is it needed?

Government figures cite the pre-existing ‘Right to Contest’, a right to contest public ownership of underused land process, as having only received 192 applications since 2014. The limitations of the Right to Contest meant that if the current owner of the land had future plans for the land, the application was unlikely to succeed, and therefore vast swathes of land remain undeveloped, without an accessible method for purchase or to challenge the local authority.

By contrast, the Right to Regenerate will compel public bodies to sell land unless the body has a plan for the future of the land, and a “compelling reason” for retaining the land.

It is hoped that the process will encourage local people to buy the land for developments benefiting their community.

The potential impact

The Government states that the process will improve the speed and ease by which land can be developed. There are no size requirements or thresholds, and therefore the regeneration may apply to small plots of land in a residential estate, for example, all the way up to large greenfield or brownfield sites ripe for development of property. This may encourage a flurry of applications by developers, in essence to claim a ‘first reserve’ over potential development sites.

Some have criticised the proposals for permitting any party, including for-profit developers, to make applications for this land. Furthermore, it is unclear if the land sold under the Right to Regenerate will be sold subject to certain affordable housing, local resident housing or wider community value conditions being met. Others have criticised the proposals for not going far enough, by only including publicly-owned land, and not land in private ownership which remains derelict or under-developed.

What’s next?

Public consultation of the proposal is now open, and runs until 13 March. Following the end of the consultation, it is expected the Government shall move to implement the changes in law.

Further details will be required to fully understand the scheme, including what constitutes “underused land”, and whether applicants may be offered a right of first refusal following their applications.

The announcement is the latest in a string of proposed housing reforms, following the announcement of leaseholders’ rights to extend their leases, and the removal of ground rent.

How Capsticks can help

Our Housing & Regeneration team, one of the largest in the country, advises on all types of development transactions from forward funded schemes, section 106 developments and stock rationalisations to plot sales and general asset management work. We are experts on all aspects of planning law including s106 agreements, CIL advice, planning appeals, Compulsory Purchase Orders and all general planning law matters.

If you have any queries around what is discussed in this insight, or the steps that you can take in any given case, please speak to Chimi Shakohoxha or any of your contacts at Capsticks to find out more about how we can help.