Council’s policy ‘a serious threat’ to developers

Tim Waring, a close adviser to several major investors in the region, said Leeds City Council’s proposed changes to planning policy represent “a serious threat” to developers proposing new purpose-built student accommodation and ignore long-term trends.

The local authority wants property companies to demonstrate the need for new accommodation and ensure that student blocks can be adapted for families in the future.

Mr Waring, of Indigo Planning, told the Yorkshire Post that the proposals are inconsistent with Government planning policy, anti-competitive and add an unnecessary layer of bureaucracy.

“It seems counter intuitive in economic terms to put the brakes on a development sector that has been active despite the recent economic downturn and appears intent on continuing to develop in the city,” he said.

“I hate to use the term ‘closed for business’ but... they are putting potential restraints on development.”

Mr Waring described the recommendation that student accommodation be built to a standard capable of conversion to residential property as “simply unworkable” to many investors.

The committee member of the British Property Federation said the council is responding to a report suggesting surplus capacity of accommodation in the short term. “Planning is all about the medium and longer term,” he added.

According to research, almost 13,000 students were living in purpose-built accommodation in Leeds last year, up from 5,200 in 2007.

With favourable yields, the sector has been attractive to many investors, who have spent tens of millions of pounds on developing schemes in the city.

A new council report said: “For the past decade student numbers have been steadily increasing.

“This trend... has led to a substantial increase in purpose-built student accommodation, particularly in or around the city centre.

“More recently, changes to the economy and university funding have led to a reduction in demand for student accommodation and this has led to an oversupply.

“Evidence suggests that the 2013-14 intake will see an oversupply of 4,668 bed spaces and using current supply figures this is predicted to rise to 8,470 by 2015-16.

“By contrast developer interest remains high, with several recent permissions for further accommodation and continuing pre-application interest.”

The report added: “The council is concerned that left unchecked, this may lead to a new housing bubble within Leeds.

“Current large student blocks are difficult to adapt to traditional housing and as such there could be a large amount of vacant blocks in the future without policy intervention.”

Coun Peter Gruen, the council’s executive member for neighbourhoods, planning and support services, said: “With a significant number of student beds in Leeds already surplus and additional student housing projects already approved, it is only right to provide guidelines to help assess future proposals for purpose-built student accommodation in the city.

“We would continue to encourage the conversion of houses of multiple occupancy which are no longer needed for student accommodation to use by families.

“The policy will give plans panels more guidance when making decisions on individual applications, which are considered on their own merits.

“The amended policy will be considered as part of the independent core strategy examination in October.”

Sector that’s proved a lifeline

By many accounts, the purpose-built student accommodation sector has seen a boom in recent years, providing a lifeline to many struggling construction companies hit hard by the downturn in many other markets.

According to research from housing groups, the number of bed spaces in Leeds in 2008-9 was 14,229. Currently the number stands at 21,384.

Between 1998 and 2006, there was a rapid growth in student numbers due to the expansion of the universities, leading to a dramatic increase in student accommodation, particularly in popular cities like Leeds and Sheffield.