Posted: 02 Aug. 2021 5 min. read

Right to Regenerate

The Ministry of Housing, Communities and Local Government (“MHCLG”) is considering reforming the Right to Contest, relaunching it as the ‘Right to Regenerate’.  Consultation closed on the 20 March 2021.

The Right to Regenerate is intended to be a quicker, easier route for individuals, businesses and organisations to identify, purchase and redevelop underused or empty land in their area.  It is intended to empower the public to request the Secretary of State (“SoS”) to evaluate whether publicly owned land is underutilised or vacant. If it is, an order will be issued to the public body holding the land, directing it to sell its interest to a purchaser which will put it to productive economic use, such as providing homes for local people. 

The consultation is based on the perceived non-success of the Right to Contest: between 2014 and February 2021 there have only been 192 requests, of which 145 were refused, 10 withdrawn, 9 are pending, 27 were invalid, and only 1 direction to order disposal was issued.1

This note provides an overview of the current position of the proposed Right to Regenerate, including the proposed changes being considered within the public consultation and forecasting conclusions & next steps.

Right to Regenerate Consultation

The Right to Regenerate Consultation was held between 16 January to 20 March 2021 and invited opinions and views on the following proposals:

  • Increased usefulness and effectiveness of the Right to Regenerate
  • Making it clearer when land is unused or underused
  • Extending the scope of the Right to include unused and underused land owned by town and parish councils
  • Extending the Right to be exercisable over land where a temporary use cannot be identified
  • A greater role for local authorities - whether to require applicants to demonstrate they have contacted their local authority before making a request, to speed up local authorities’ progression of and response to submitted requests.
  • Presumption in favour of disposal - whether, when considering applications, the SoS should apply a presumption in favour of disposal unless there is a compelling reason not to do so.
  • Increased transparency - whether local authorities should produce quarterly reports on the number of preliminary enquiries made and publicise physically and electronically that a request has been submitted for the release of a site.
  • Introduction of a time-limited Right of first refusal for market value - available for those who make the request, recognising local groups may need additional time to prepare suitable finances and bid. 
  • Whether conditions ought to be imposed on disposals - whether the SoS should specify in the direction terms and conditions for disposal of land (for example, that a sale could only proceed if there is an intention to redevelop the site).

Conclusions and Next Steps

MHCLG has not yet published the responses to the consultation as of 22 July 2021.

Some of the public responses from public bodies suggest the following:

  • If the proposals are implemented it should increase the amount of public sector land for sale. Moreover, the process could favour smaller developers over larger developers, although this will depend on the size/complexities of the sites being sold;
  • There may be no need to retain the Right to Contest (or a reformed version), given the extensive public sector land release programmes that have taken place, especially in recent years;
  • It may be problematic to order a sale where temporary uses cannot be identified for unused land which has an intended future use. It risks undermining longer term development strategies for local areas and it would not guarantee that the land will subsequently be brought into effective use to deliver local community benefit;
  • The definition for unused land should be clarified to recognise that unused land is not necessarily surplus. Surplus properties at local authorities may be those that have been deemed surplus to “operational” requirements of the Council and are therefore ‘unused’ and available for disposal. This also makes the asset available for non-operational use or investment and income-producing activities. Vacant properties may additionally be retained for future service use or simply as a strategic hold. Whilst these may be currently ‘unused’ they will be used longer term, and a definition may need to reflect this, possibly providing a list of exemptions.
  • Whilst the Right to Regenerate has the potential to help regenerate local areas, this must be done with the highest regard to quality, safety and sustainability. The process of procuring empty properties, and the criteria for acquiring them, should be carefully considered.

Deloitte will be monitoring the outcome of the consultation and it will be particularly interesting to see how many public bodies are supportive of the proposals, and whether there are any similarities in geographical responses given Government’s Level Up and Build Build Build agenda.

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1 https://www.insidehousing.co.uk/comment/comment/what-will-the-right-to-regenerate-mean-for-social-landlords-69776

 

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Lindy Howard

Lindy Howard

Director

Lindy is a Director in the Deloitte Real Assets Advisory team and leads the Urban Centres and International business. She advises on all property development matters; specialisms include: development viability, major urban regeneration, large scale residential, town centre redevelopment, and infrastructure funding. She is an expert on government policies relating to property development with a particular specialism in Subsidy Control, Best Consideration and Infrastructure Funding. She has appeared at Examinations in Public providing evidence at Local Plan and Community Infrastastructure Levy hearings. She is a member of the RICS Working Group set up to provide Government with industry comments on Pillar 3 Infrastructure Levy of the Planning White Paper.

Neil Gammie

Neil Gammie

Director

Neil is a Director within the Residential Department. Over the last fifteen years Neil has worked with Registered Providers, Local Authority and Private Sector clients across the country to assist in the delivery of new private and affordable housing. Neil has specific experience in the preparation of formal market valuations, development appraisals, feasibility studies, project viability assessments, development marketing and implementation advice.

Timothy Cakebread

Timothy Cakebread

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Tim is a Town Planner in the Real Assets Advisory team focusing on public and private sector projects across London and the South East. Tim is highly experienced in providing commercially astute real estate advice on the use and development of land and property. A career highlight for Tim was his secondment to a Central Governmental Department, helping to deliver infrastructure funding for major housing proposals.