When out of town development became out of bounds, supermarkets swiftly turned their attentions to the new convenience format in town centres… and securing consents for the extension of existing stores.

The ploy seemed to work. Since PPG6, the planning policy guidance note intended to switch the focus of new development back to struggling town centres came into being in 1996, the number of applications has soared, with expansions of up to 50% routinely sought - and granted. Cue the collective sigh of relief from the supermarkets.

But was it premature?

There are alarming signs in the way the planners have dealt with several recent applications that the screw is being turned again. James Williams, partner at surveying firm Drivers Jonas says: “In some cases, particularly for major cases, it can be as difficult to secure consent as with new builds and I think it is going to get tougher.”

To blame is the beefed up PPG6 that is finally about to go out for consultation after a year’s delay.

The UK’s planning regime is already arguably the toughest in Europe. At the moment, anyone who wants to secure a planning consent for an out of town scheme - even an extension - has to demonstrate that the development would not be more appropriate in the town centre - ie that it has satisfied the so-called sequential test. In most cases it simply means proving that the town centre would not be adversely affected by the out of town extension.
Not for much longer.

Retailers must demonstrate need

Under the new look PPG6, the government wants retailers to demonstrate that the local community ‘needs’ the proposed development as well.

Adam Pyrke, director in the planning development department at surveying firm Colliers CRE incorporating Gooch Webster, explains: “Retailers have to demonstrate both quantitative and qualitative need and prove it on a functional basis - in other words that the use is appropriate - rather than on format basis.”
The first sign of the government’s hardening stance on PPG6 came when Tesco applied for a 996 sq m (10,000 sq ft) extension to its Aldershot store in 2001. Its application was approved at appeal last April but only once it had satisfied the new criteria.

Says Williams: “It did set an interesting precedent in terms of the tests applied. It wasn’t just sufficient to demonstrate that there wouldn’t be an adverse effect on the town centre offer or, indeed, that it needed more space itself. It needed to demonstrate that the residents of the area would benefit. It used to be that the onus was on the local authority to prove adverse impact - now it is on the applicant to demonstrate need.”

Common trait

Given that a common trait of residents near big out of town supermarkets is that they say they don’t want them ‘in their back yard’ but then complain if they are not there, this is no easy feat.

The anticipated changes to PPG6 throw up two other big problems for the supermarkets.

First, there has been a huge shift in the way that the government approaches change-of-use applications. Tony Kitson, head of planning at law firm CMS Cameron McKenna, says the non-food uses increasingly sought by supermarkets tend to be considered more appropriate for town centres. As a result, “extensions in town centres would be looked at more favourably than those out of town these days.”

Second, says Julian Sutton, who is associate partner at Rapleys town planning department and acts for Safeway, the government will no longer be swayed by the argument that uses are more efficiently housed under one roof. “The most difficult to reconcile is the sequential test to site selection and particularly John Prescott’s support for the ‘class of goods approach’ over the ‘format approach,” he says.
“Prescott says goods should be sold in the most appropriate location rather than the most appropriate format and, if necessary, floor space should be split or disaggregated to achieve this.

“If you’ve got an out of town store that you want to extend, you have to prove there are qualitative benefits to the people using that store. If there are not, you might have to think about looking elsewhere to put a particular use.”

The secretary of state made his intent clear in three landmark cases last December, when he turned down a planning application from Tesco for an extension to its Oldham store, as well as applications from B&Q and Ikea, on the basis that they did not satisfy the use of goods criteria.

All three cases are now being challenged in the courts, but the decisions are expected to be delayed until the final draft of the new PPG6 comes out.
That is not the end to the problem, though. Supermarkets also have to tailor their aspirations to the the government’s regeneration agenda. Not easy, says Ian Trehearne, senior executive at law firm Berwin Leighton Paisner. “The interaction between supermarket planning and regeneration has become much more difficult since Prescott took over as deputy prime minister.

“The question of regeneration has become one of physical change to the environment, rather than about investment and jobs. There’s a very clear dichotomy between the retailers, who have a clear agenda predicated on efficiency, distribution and cost, and the local authorities pursuing this far more ‘woolly’ regeneration agenda.

“At the moment, the alignment of objectives between the supermarkets and local authorities is not very realistic.”

Compulsory purchase

He cites the increasing incidences of local authorities seeking to use their compulsory purchase order powers to assemble regeneration sites because they do not have the co-operation of the resident retailer.

Tesco emerged victorious from one such spat in High Wycombe and is currently awaiting a decision on the local authority’s attempt to gain a CPO on land in Surrey Quays, London.

But supermarkets like Tesco are rapidly discovering how futile it is to try to second guess the outcome of any major planning application, so varied the stance taken by different local authorities can be. As Trehearne succinctly puts it: “Some local authorities are just better at dealing with the regeneration agenda than others.”

It is a worrying sign of the times when supermarkets that fail to secure consent just give up the chase. Williams confirms: “Retailers and food store operators in particular are much more cautious about going to public inquiries. A few years ago, if they were refused consent they would take a punt on the planning appeal. Now, if they’re refused it is the end of the story.”

Williams is holding out in the hope that the amended PPG6 will clarify rather than complicate the situation. “We want clarification. There are still areas of the sequential approach that are not entirely clear. And what exactly is the definition of town centre? How does it differ from a local centre? I mean, we’ve had situations where very large stores have come into very small local centres saying they are compliant, but is this right?”

The good news is that successful planning applications like Tesco’s at Aldershot prove that the big supermarkets are already wising up to the issues. Kitson insists: “It’s all do-able provided you press the right buttons.”

But there is no getting away from the fact that now, with the government pushing ever harder for the regeneration of our town centres, the out of town planning maze is only going to get tougher to negotiate.

The question is: once the retailers exhaust the convenience store format in town centres - where next?