Forewarned is forearmed
5th Jan 2020
We are about to start the planning process for a corner property purchased, for a client, in Cricklewood, North West London. The property consists of a commercial on the downstairs and residential on the upstairs.
When purchased the upstairs was used as an HMO, but without a licence. The local council have signed what’s known as an Article 4, which means you cannot have an HMO without going through full planning. Ordinarily, one can convert a house into an HMO without the need for planning, under permitted development, which is granted by central government.
So, what we were actually purchasing was an illegal HMO.
However, normally to be classed as an HMO you need more than two unrelated people occupying the property. Luckily, at the time of purchase, there was only one; partly due to the lock down.
Given the current situation, all independent business will be struggling. Being pressured from business rates and rent on one side and on the other a drastic drop in business, this will topple most businesses over the edge.
We bought this property with this in mind. You have to envisage what will happen in time to come. This being a corner property it lends itself well to conversion into residential.
The residential element can be accessed from the side street and it can be integrated into the rest of the apartments above.
The conversion will be carried out under Permitted Development, therefore, it can be done with certainty and within a set time period.
A very small retail element will be kept on the High Street, this is classed as zone A and is the most valuable portion of a commercial property. The idea being it will be appealing to a small one man business, which will be exempt from business rates due to its size, and will only have a small element of rent to it.
The deal was done with this level of forethinking built into it, as it is a very likely scenario of this plandemic.
The aim is to push upwards and to the rear from the 1st floor upwards. This will add a further 60% to the property, thereby increasing the value by a similar amount.
We have a planner who is advising us on what can and cannot be done with the property, and in what order.
Once we have added the square foot, there is a possibility to turn this into an HMO. Though it will need to go through planning. This is a very good location for a good HMO to be, given its proximity to Central London.
The article 4 doesn’t necessarily mean the council does not want HMOs, merely that you need to go through planning to get the permission. This could mean they want a tighter control on the process and what gets approved.
I’m pretty sure if you designed a good scheme and had interest from the local Royal Free hospital, you could get the required scheme to be passed.