Valuation & Advisory

Implications for Nursery Settings

The Government introduced significant changes to the Use Classes Order in England, which came into force on 1 September. A recent Judicial Review claim against it has just been thrown out, meaning the reforms will go ahead.

Nurseries shutterstock 1243109917

19 November, 2020

Class D1 (non-residential institution) and Class D2 (Assembly and leisure) uses have been abolished, along with Classes A1 (shops), A2 (professional services), A3 (restaurants) and B1 (offices). The majority of these uses have been merged into a new ‘Class E’, including nurseries. Changes between these uses will not require planning permission, and should lead to increased flexibility between these uses to support the diversification of the high street.

The additional flexibility may be broadly welcome, but there are implications, beneficial and adverse, for nurseries, including:

  • Increased supply = more opportunities to expand
  • Planning permission is now required for nurseries to occupy churches and educational buildings (now in Class F.1)
  • Unauthorised / uncertain changes of use:
    • Is planning permission now required to run childcare facilities from a public / church / village hall?
    • Does a pre-school, operating within school hours during term-time, constitute an educational facility (Class F1), a nursery (Class E), or a combination of the two (sui generis)?
  • Effect on value – negative / flat?

There appear to be many unintended consequences of the reform, which is not welcome for nurseries in the middle of a transaction or planning system, but longer-term we would hope to see increased supply and therefore more opportunities for operators seeking to expand.

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