The new Labour government has made planning reform central to its mission to drive economic growth and to "get Britain building."

These were the words used by Rachel Reeves in her first speech as Chancellor. Just over a week after this statement, the King's Speech to the Houses of Parliament provided more details, announcing the new Planning and Infrastructure Bill.

This legislation introduces various reforms aimed at accelerating house and infrastructure construction. Highlights include 300 additional Planning Officers to expedite consent and changes to rules concerning compensation from Compulsory Purchase Orders.

Allied legislation introduced in The English Devolution Bill also granted metro mayors new powers to create Local Growth Plans. Deputy Prime Minister Angela Rayner has previously promised these will help mayors "deliver local economic growth with better housing."

Labour's three-pronged approach includes proposed reforms to the National Planning Policy Framework (NPPF), currently out for consultation until September 24. These proposals aim to simplify granting consent for major infrastructure projects, such as hospitals and electricity pylons, by labeling more schemes as 'Nationally Significant Infrastructure Projects' and granting final approval to the housing secretary rather than local councils. Brownfield development will receive a default 'yes,' while restrictions on PDL redevelopment in green belts will be relaxed.

Andrew Charnley, Managing Director of Assetz Capital, questioned whether lenders would respond positively to these policy changes by designing new products or enhancing existing ones to encourage developers. He noted that previous relaxations of permitted development rights (PDRs) by the Conservative government had led to significant opportunities but that these were not included in Labour's current NPPF proposals.

Charnley highlighted that there are an estimated 165,000 privately-owned commercial premises currently empty across the UK, with an additional 7,000 owned by local authorities vacant for over 12 months. He emphasized this as a missed opportunity for conversion into residential spaces.

A research brief published by the House of Commons Library earlier this year revealed that between 2015/16 and 2022/23, close to 103,000 new homes were delivered through change-of-use PDRs. Most (89%) were created through converting offices and other commercial units.

Research commissioned by the previous government in 2020 suggested that homes created through PDR were of lower quality than those built through planning permission via LPAs and some were located in unsuitable places. This could explain why the Labour government has yet to focus on PDR reform despite its goal of building 1.5 million new homes within five years.

Charnley argued that further review of current PDRs could accelerate conversion rates if combined with incentives like tax breaks for developers and suitable lending products designed specifically for these needs.

Assetz Capital specializes in converting commercial spaces into residential areas. Earlier this year, they launched an innovative Planning Assistance Loan allowing developers to purchase commercial space before obtaining necessary planning permissions. With a £100m fund available for loans up to £5m per project, Assetz Capital aims to support developers from start-to-finish on larger projects.

Charnley concluded by emphasizing how lenders could show their commitment to revitalizing towns and cities through such initiatives, ultimately boosting local economies.