Brits have long had an interest in property, whether it be a house or a flat. As a result, it’s not surprising that in recent years this love of property has expanded into commercial property, with more and more people investing in it.
However, if you’re just dipping your toe in the water, how will you know what type of commercial property is right for you and your business? In this article, we’ll be exploring the different types of commercial property so you can determine what will work best for you.
Commercial property classifications
You might not know it but each type of building in the commercial property market is divided into five main categories, depending on what the building is being used for. These five categories are:
- Retail- shopping centres, retail stores, shops
- Industrial- factories, warehouses
- Leisure- pubs, hotels, cafes, restaurants, sports facilities
- Healthcare- hospitals, medical centres, nursing homes
What do the classifications mean?
The Town and Country Planning (Uses Classes) Order of 1987 outlines how each type of commercial building should be occupied. Each building’s use is defined by its local authority, known as a “use class.” Any business conducted in the commercial building needs to be in line with its planning use, or the business could be fined.
For example, a building with A3 usage can be used for “the sale of food or drink for consumption on the premises or of hot food for consumption off the premises”.
The property classification system can help in two important ways:
- The planners for an area can make sure that the area doesn’t include certain property types to lower the number of complaints – for example, no pubs.
- It highlights the type of business that is allowed to move into the premises.
What are the commercial property use classes?
Below are some of the main use classes for commercial property.
A1 – Shops
This space can be used for retail sales, a post office, ticket sales, or a travel agency. It can also be used to sell sandwiches or other cold food, as well as the below purposes:
- For hairdressing
- For funeral direction
- Displaying goods for sale
- Hiring out domestic or personal goods or articles
- For the reception of goods to be washed, cleaned, or repaired
A2 – Financial and professional services
- Financial services, such as banks
- Professional services (other than health or medical services)
- Any other services (including use as a betting office) which are suitable to provide in a shopping area
B1 – Business
For any or all the following purposes:
- Offices not classified in A2
- Research and development spaces
- Any industrial process, such as labs or high-tech industries
C2 – Residential institutions
- Boarding schools, residential colleges, and training centres
- Residential care homes, hospitals, nursing homes
F1 – Non-residential institutions
Any use, not including residential:
- Places of worship, church halls
- Clinics, health centres, day nurseries, consulting rooms
- Museums, public halls, libraries, art galleries, exhibition halls
(Please note, F1 properties were previously known as D1 properties but were updated in the new use class changes).
D2 – Assembly and leisure
- Cinemas, music, and concert halls
- Dance, swimming baths, sports halls, ice skating and skating rinks, gymnasiums
- Other indoor and outdoor sports and leisure uses, like bingo halls and casinos
Any uses that don’t come under the main classes are known as “sui-generises”. This includes properties like theatres, nightclubs, petrol filling stations, scrap yards, launderettes, etc.
Our conveyancing solicitors in Newcastle can help you with buying, leasing, selling or any other legal and financial issues relating to your property, to make managing your investment easier and stress-free.