Out-Law News 1 min. read

Southwark announces measures to reduce impact of 'vacant building credit'


Southwark Council has announced that it is to introduce a series of measures to address the impact of a policy change that has reduced the affordable housing contributions councils can seek where vacant buildings are demolished or brought back into use.

In December, the Department for Communities and Local Government (DCLG) published its response to a consultation (10-page / 334 KB PDF) on section 106 planning obligations. In the response, the DCLG said it would press ahead with a policy change that would require councils to deduct from affordable housing contributions "a financial credit equivalent to the existing gross floorspace of any vacant buildings brought back into any lawful use or demolished for re-development".

The Council said last month that the change, which has been dubbed the 'vacant building credit' (VBC), meant brownfield sites awaiting development in the borough "could deliver only a fraction of the potential affordable housing, rather than the 35% affordable housing provision usually required". The Council has now announced a series of measures it hopes will restrict the circumstances in which the VBC will be available to developers and reduce its impact on affordable housing provision in the borough.

In a statement published on Tuesday, the Council said it would set guidelines defining when a building is 'vacant', and therefore eligible for VBC, or 'in-use', and therefore ineligible. According to a report produced for a meeting of the Council's planning committee this week, buildings that have been "in lawful use for a continuous period of at least six months within the [past] three years" will be considered 'in-use' and those which have not will be considered 'vacant'.

In addition to meeting the new guidelines for vacancy, developers will be required to demonstrate that "the relevant buildings have been actively marketed on realistic terms over a period of at least 24 months within the previous 36 [months]" in order to apply for VBC in the borough, according to the report.

The Council has also said that it intends "to amend its development plan to establish a local VBC exemption policy on the basis that the credit is not needed to kick start development and that it undermines the sustainability of future development in the borough". According to the meeting report, the exemption policy would be introduced through a minor amendment to the Council's core strategy, with adoption of the policy expected "from January 2016".

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