When acquiring or leasing commercial property—whether an office building, industrial unit, retail unit or development land—the role of planning permission is central. For lawyers, conveyancers, investors and occupiers alike, understanding how planning consent intersects with the conveyancing process is essential. If the planning status is unclear or incorrect, it can lead to serious legal risk, cost and delay. In this blog we explore what planning permission means in the commercial context, what checks and due diligence your conveyancer will perform, how planning issues can derail a deal, and how you can manage and mitigate the risks.
What Is Planning Permission (and Why It Matters)
“Planning permission” is the formal approval by the local planning authority (LPA) for the development of land or the material change of use of a building. Under the Town and Country Planning Act 1990 (“TCPA 1990”), it is required for carrying out “development” on land, which includes building operations, engineering, mining, or other operations, and material changes in use.
In commercial real estate this matters because:
- The intended use of a property (office, retail, warehouse) may require planning consent or may be constrained by use‐classes and local plan policy.
- Major alterations—extensions, change of use, redevelopment—will usually trigger the need for planning permission (or at least a check whether “permitted development” rights apply).
- If planning permission is missing, incorrect or the use is unauthorised, the property may be subject to enforcement action, value may be impaired, and lenders may refuse finance.
- In conveyancing, your solicitor must search and confirm the planning status of the property so you fully understand what you’re buying or leasing.
Thus, planning permission is not a peripheral issue—it is a core part of risk and value in commercial property deals.
How Planning Permission Interacts with the Conveyancing Process
When your conveyancer handles a commercial property transaction (whether a freehold purchase, lease, or development land acquisition), planning permission will intersect at several key stages:
1. Pre-Contract / Head of terms
At this early stage, the buyer or tenant should consider what their intended use is and whether the property as is has the right planning classification or consent. For example, is the property currently used for retail, but the occupier wants to convert to leisure, or from warehouse to offices? Do they need a change of use approval? Your conveyancer will advise you to check this.
It is prudent to build into the heads of terms or offer a clause acknowledging that satisfactory planning status is a condition precedent. If the use is not lawful or the consent is flawed, that may give you an exit or renegotiation path.
2. Due Diligence / Searches
This is where your conveyancer will probe in detail:
- They will obtain local authority searches and local land charges records to see if the property has outstanding planning enforcement notices.
- They will review title and contract documentation to confirm that any development or change of use has the appropriate consent. If you are acquiring development land, they’ll check whether the planning permission is outline or full, whether reserved matters have been approved, and whether conditions have been discharged.
- They will check for restrictions on permitted development rights (e.g., via an Town and Country Planning (General Permitted Development) (England) Order 2015) which may affect whether future change of use or works can be done without full planning.
- They may check that any planning permission granted remains valid (has it lapsed because work has not started within the required timeframe, typically three years in England).
3. Contract / Lease Documentation
In the contract (for purchase) or lease (for letting), planning issues should be reflected:
- The seller/landlord may provide warranties that all necessary planning permissions have been obtained and are still valid.
- The buyer/tenant may include a condition or clause allowing them to withdraw or renegotiate if planning consent is not as expected.
- The lease may include obligations for the occupier to comply with planning conditions or may restrict alterations of use without landlord consent (which ties into planning). For example, a lease might forbid use outside the permitted use class.
- For development land, the contract may specify that completion or purchase is contingent upon planning permission being obtained or the reserved matters being approved.
4. Completion / Post-Completion
After completion or lease commencement, planning status remains relevant. If you proceed with a use that is unauthorised, or carry out works without permission, you risk enforcement action, fines, requirement to reinstate, and value loss. If you hold property for development, failure to act within the timeframe of permission may mean you lose the consent and the fallback value is compromised.
Your conveyancer will advise that you keep records of compliance, ensure conditions attached to permissions are discharged and consider insurance or indemnity if defects are discovered.
Key Planning Permission Risks in Commercial Conveyancing
Here are specific risks that may arise and what you should look out for:
- Change of Use Risk: The property may currently have a permitted use (say warehousing), but your business intends a different use (say retail or leisure). If the property falls outside the current use class or the change of use requires consent (or has been done without it), you may be unable to operate legally.
- Lapsed Permissions / Unauthorised Works: If previous works were done without planning permission, or a planning consent has lapsed (i.e., insufficient progress has been made), there may be enforcement risk, or you may need to apply for retrospective consent (which may be refused).
- Permitted Development Rights Removal / Article 4 Directions: Even if a property has certain permitted development rights (e.g., small changes or change of use), an Article 4 direction or local policy may restrict them, meaning what seemed possible may require full planning.
- Conditions Attached to Consent: A planning permission may carry onerous conditions (e.g., landscaping, hours of operation, signage, access). Failure to observe these can lead to enforcement. The contract needs to review them.
- Value and Financing Impact: Lenders often require that the property is lawfully used and that any future change of use works have consent. If not, finance may be refused or more expensive.
- Exit/Resale Risk: If you purchase with the intention to redevelop and the planning permission is uncertain or challenging, your exit value may be compromised.
- Insurance/Indemnity Risk: If an issue arises (e.g., unauthorised development), you may need to take out an indemnity insurance policy—or worse—need to apply for retrospective consent which may be refused or subject to enforcement.
How to Mitigate Planning Risk in Conveyancing
Given the risks above, here are practical steps you can take:
- Engage specialist advisers early – In addition to your conveyancer, consider engaging a planning consultant or planning‐savvy solicitor who can review the planning history, recent applications, and local policy.
- Review current use and future use – Be clear what you intend to do with the property. If your business needs a change of use or redevelopment, check whether permission is already in place or whether the current use is lawful.
- Check validity of existing permissions – Ensure any granted planning permission is still valid, reserved matters (if applicable) have been discharged, and the time to start works has not lapsed.
- Obtain copies of permissions and conditions – Ask for all relevant planning decision notices, associated conditions and section 106 obligations (planning obligations under the TCPA) that may affect the property.
- Tailor contract/lease protections – Include conditions precedent or warranties relating to planning status. Consider making completion subject to obtaining planning consent if required.
- Assess exit/resale implications – If you are acquiring for investment or redevelopment, assess how marketable the property will be if planning consent is uncertain or constrained.
- Budget for remedials – If you find planning issues (e.g., unauthorised works), budget for the possibility of retrospective applications, enforcement costs or reinstatement.
- Monitor and comply post-completion – If you proceed with works, ensure you adhere to any planning conditions, maintain records and ensure your use remains within the permitted class.
- Consider indemnity insurance – If certain minor planning defects cannot be resolved immediately, an indemnity policy may provide cover, but its cost, scope and insurer appetite vary.
- Stay abreast of policy changes – Planning policy, permitted development rights, use classes and local authority positions change over time. What was compliant becomes non-compliant, so historical permissions may be challenged.
Illustrative Example
Imagine you are leasing a warehouse unit intending to convert it into a boutique fitness studio. On the face of it, the unit is in an industrial park and the lease is being negotiated.
The due diligence reveals that the current planning use class is light industrial (say Class E in England) and that the change of use to a leisure use (Class F or other) requires planning permission. Also, the local planning authority has issued an Article 4 direction removing permitted development rights in that estate. As a result:
- Unless you secure planning permission for the change of use, your fitness studio may be unlawful or subject to enforcement.
- The landlord may be unable or unwilling to carry out fit-out works without planning consent and accordingly may not grant you assignment/sub-letting rights or a longer-term lease.
- Your lender (if financing fit-out) may require proof of lawful use.
- You need to negotiate your lease to include condition precedent for planning consent or include a warranty from the landlord.
- You should budget for the planning application and factor in risk of refusal when assessing viability.
Through the conveyancing process your solicitor would: check the planning history of the property, review search results for enforcement notices, examine local plan policy, advise you on whether consent is required, and ensure your contract/lease reflects this.
Conclusion
In commercial property conveyancing, planning permission is far more than a technical formality—it is a pillar of value, risk, operational compliance and exit strategy. Whether you’re acquiring a business premises, leasing a unit for occupation, or buying land for development, ensuring that the planning position is solid is critical. A defective or uncertain planning status can erode value, obstruct operations, trigger enforcement or derail finance.
By engaging planning expertise early, aligning your business use with the property’s planning status, inserting appropriate protections into your contract or lease, and performing diligent checks and budgeting, you significantly reduce your risk and increase the likelihood of a transaction that delivers on its commercial objectives.