Commercial property applies to any type of building where a business is located. This could be an office, retail outlet, gym, hairdressing salon, hotel, warehouse, movie theatre etc.
One of the most common forms of commercial into residential property conversion is the shop with a flat above. But offices too are regularly converted into residential accommodation. Just two months ago in Leicester, in fact, the former five story office block Wellington House was sold to developers Aimrok. They plan to turn the property into 83 smart residential apartments. Cost of the sale was £5.6 million, with permission granted to Aimrok to add more storeys at a later stage. So popular was the property, that it attracted 15 serious bidders.
Around 40% jump in commercial property sales
Commercial property in general has been proving popular in recent years, especially since the government increased business rates, which effectively crippled many local businesses. Online retail too is taking away from the high street, while many more companies are operating ‘work from home’ policies. The number of self-employed individuals in the UK also increases on an annual basis. Upmarket estate agency said they had noticed a 40% increase in sales of commercial property since 2016.
In order to turn a commercial building into a residential property, you’ll need planning permission from the relevant local authority. Sometimes buildings are sold with planning permission already granted, making them a more attractive purchase. At other times, you won’t need full planning permission, making the building easier to convert. This is the case if it’s a light industrial unit you’re converting or a shop of 150 square metres or less, and is known as Permitted Development Rights.
Permitted development rights (and restrictions)
These make it much easier to convert a building from commercial to residential use, but they do come with their own restrictions. One is that the work has to be carried out within a set period of time (usually around three years) and that it only applies to change of use (i.e. from commercial to residential). This means that any designs which involve removing walls will still be subject to the usual planning permission.
Existing commercial properties for sale in Leicester
● A three-story light industrial unit in Leicester’s Freeman’s Common could be ripe for conversion into apartments. Currently advertised on Rightmove, the ground floor was used for warehouse storage while the remaining two floors were offices. Measuring 5,575 sq ft, it’s on at £475,000;
● A large two-storey freehold public house on the north east side of the city at Humbertone Drive, with an added flat roof extension, is for sale at £600,000. There exists plans for 16 single bedroom apartments on the premises. However, these have not been submitted to planning;
● A mixed-use property at Braunstone Gate in Leicester, comprising a former nightclub with basement, ground and first floor and a three-bedroom residential self-contained property is for sale at £480,000;
● A restaurant premises is for sale at £275,000 in Welford Road. The two storey building measures 950 sq ft.
Speak to Sam Ballard who specialises in investment property.
Call 0333 123 1330