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Research Study on the Effectiveness of NPPG 8 Town Centres and Retailing
5. Support for New Development
5.1 The original client Brief highlighted the importance of issues such as the sequential approach and the definition of different centres. However, emerging from these issues in the original Brief was the question of adequate support for town centres. It was noted that many centres have some way to go to ensure that market expectations by retailers and others in terms of the size and type of retail units are being met and that the shopping experience meets consumers and retailers' expectations. The Brief questioned whether there was a need to address further measures and actions to improve town centres and could local authorities, in partnership, take a more proactive role in identifying and delivering development sites?
5.2 In the following sections we review findings from our desk research work and then set out findings from primary research into land assembly/site development issues.
Findings From Desk And Survey Research
5.3 Support for new development in town centres and other locations is a narrowly defined topic and the research team decided to make it a research exercise in its own right; under the survey research, the final issue was site development issues. This is summarised under a later sub heading below. However, first we have drawn some of the conclusions on this topic from the other research tasks.
5.4 In the Report of Desk Research, the general retail review by IRS identifies key issues such as political, economic, social demographic and product/process and environmental changes as key drivers in the retail system. Although these drivers might be seen as remote from land use planning and development solutions, they are all important factors in the activities in the development industry, in bringing forward propositions for new retail and commercial development in urban centres. The IRS research continues with a specific look at the need to accommodate continued retail sales growth, accept developments in retail format and to look carefully at optimal choices being made by developers and retailers alike for key locations. As a result, this background research points to the competitive effects in retailing bringing about a succession process between the surviving centres and other centres which, perhaps might need to be subject to managed decline in physical terms, with alternative land use options.
5.5 All the above factors point to the need to understand property development processes and pressures, land assembly issues, end use occupier demands and various other land assembly, viability, site preparation and infrastructure issues which influence levels of new development. Levels of new development were researched in the retail profile section of the desk research and, as identified earlier in this report, there has been no dearth in the Scottish pipeline for new retail proposals in town centre and out-of-town locations. In the majority of cases, floorspace proposed has actually been consented and most of this has been built. Therefore, there is evidence that the development industry has not abated its interest in producing more retail floorspace over the last five years. However, there is evidence that a more abundant level of floorspace has accrued in out-of-centre locations, particularly through a relative boom in retail warehouse space around the turn of the century. Comparable levels of town centre floorspace are lower (although it is accepted that town centre shopping floorspace can provide for a greater variety, range and intensity of use than some bulkier retail warehouse formats).
5.6 Other sources of the research, including commentary by property professionals and the review of policies and decisions points to a need for a continual updating of the "health check" on town centres. Vitality and viability is judged to be a useful indicator in NPPG8 as long as it is applied in an up to date context to the benefit of town centre development and expansion.
5.7 It was interesting to see that the full range of both Structure and Local Plans made repeated reference to some form of policy encouraging and promoting new retail development in existing town centres. There was, however, limited reference to town centre strategies which would go beyond the encouragement of promotion role, towards actually facilitating new development in existing centres by different means. Similarly, Local Plans often make reference to opportunity sites but there is limited evidence of specific policies geared towards implementation of development on these sites, or identification of resources to facilitate this.
5.8 Policies and proposals make sporadic references to various forms of partnerships, enterprise companies and other agencies. However, there is scant reference to actual opportunities, resourcing and programmes being taken forward by partnerships.
5.9 The input from CBP on transport issues highlights some of the points from the Key Sites appraisal methodology where highly accessible sites with potential for public transport advantage could be brought forward for higher density travel generating development. This could be mixed use development with an encouragement for innovative and high quality physical solutions. Some of the supplemental advice in the Key Sites study looked at the viability issues of assembling sites and the possibility of incentives to encourage developers to look at transportation investment, on the basis of the potential for increased returns in the long term and recognition of the value of their investment in the planning hierarchy.
5.10 From the public and private sector questionnaires in the Report of Survey Research, there was frequent reference to the need for sharper policies and clearer best practice guidance on the assembly of town centre sites and the promotion of new development opportunities.
5.11 Many of the unprompted comments from public sector respondents referred to the difficulties of site assembly and bringing forward central development projects, within the resources available. There was frequent mention of CPO, land assembly and land purchase issues.
5.12 Question 2 of the questionnaire surveys looked at whether the respondent's planning authority had produced any specific town centre strategy or Development Briefs.
Table 5.1 Public Sector Production Of Town Centre Strategies Etc.
5.13 Although paragraph 33 of NPPG8 specifically states that planning authorities should adopt a proactive role and agree an overall town centre strategy and partnership with others, Table 5.1 shows that only 38% of respondents made mention of a specific town centre strategy prepared in the last five years. There were various other references to different kinds of retail studies, but none of these was judged to be specifically town centre strategies or Development Briefs for new schemes, in the view of the study team, when appraising the questionnaire responses.
5.14 This is obviously a significant result from the public sector side, and suggests that NPPG8 guidance on town centre strategies will need to increase their profile, method of preparation and the importance of their output.
5.15 Q6 of the questionnaire included a direct reference to the effectiveness of NPPG8 as a guide to various aspects of policy. From the various answers, (see table 5.2 below) the public sector respondents generally believe that the policy was less than clear and instructive on the specific topics of town centre strategies, identifying town centre sites, ensuring an efficient and competitive retail sector and promoting design quality and attractive environment. Less than 40% thought that NPPG8 provides clear guidance about site identification. This was the lowest positive response out of the 10 issues listed. We believe these responses are linked to the overall comments given on development issues and the level of support for new development.
Table 5.2 The Effectiveness Of NPPG8 As A Guide To Policy
5.16 Indeed, Question 6 had a follow up item on whether best practice guidance was required for certain issues. Preparing/promoting town centre strategies and identifying/assemble town centre sites both received strong 'yes' responses when asked whether further best practice guidance was required (Table 5.3).
Table 5.3 The Need For Best Practice Guidance.
5.17 In conclusion, we believe that there is a significant level of response amongst the public sector that further policy guidance could be given on the issue of supporting new development in appropriate centres.
5.18 From the private sector questionnaire, comments were given on support for new development, with the belief that more initiatives could be undertaken to bring forward central sites. In addition, some of the responses to questions are revealing on this topic:
- As noted under Section 2 above, comments on general trends make reference to the need for some flexibility to allow new retail formats into new developments, district centres and other locations.
- An important question was whether private sector businesses have been involved in development briefs or town centre strategies (Table 5.4)). In this case, only 7% said that they had been engaged in a town centre strategy in Scotland in the last 5 years. Whilst another 20% had seen some involvement in general retail studies/ vitality and viability assessments, 73% had taken no involvement or made no response in respect to town centre strategies. It is interesting to compare this with the level of activity reported back from the public sector side. There is some suggestion here that public sector-led studies might not be engaging the private sector to a full extent.
Table 5.4 Involvement in Town centre Strategies.
- Question 6 also questioned private sector respondents' views on the effectiveness of NPPG8 as a general tool for policy and decisions in respect to different topics. Table 5.5 (below) shows that the private sector showed some disappointment in the policy being less than clear/ instructive on the identification/ assembly of town centre sites (less than 20% found it clear and instructive); efficient and competitive retail sector (less than 20%) and policies to promote design quality and an attractive environment (less than 25%).
Table 5.5 The Effectiveness of Nppg8 as a Guide to Policy
5.19 The responses to Question 6 also revealed that, out of those making a comment about best practice guidance, relatively high numbers believed there should be further best practice guidance on identification/ assembly of town centre sites (43%), ensuring sustainable development, sustaining the vitality/ viability of centres and ensuring an efficient and competitive retail sector (Table 5.6). The high proportion identifying need for guidance on identification/assembly of town centre sites mirrors the public sector's response on this topic.
Table 5.6 The Need for Best Practice Guidance.
5.20 Further comments have been given in separate parts of this report (in particular the discussion group and focused interview responses). However, it seems that the need for further support for new development is a key area in the response from the private sector interests.
5.21 From the discussion and questionnaire exercises with the town centre managers, there was a significant level of agreement to the suggestion that the benefits of future retail development could be better harnessed by the planning authority being more flexible, realistic and proactive in promoting new sites in the future; an average score of 3.8 on a scale of 5 (strongly agree) to 1 (strongly disagree). The TCM audience felt that flexibility on development sites was important. In some instances, city centre sites are considered to be more problematic relative to out-of-town. Consequently, if guidance is too prescriptive against edge of / out of centre development, this could be detrimental to future development. Future plans need to take account of the physical constraints that may exist in town centres. TCM could adopt a closer role in a blue print for town centres providing for an immediate core, an outer core and an expansion core, allowing the boundary of the town centre to be flexible and to take account of spatial growth or changes to retailers' formats.
5.22 From the Stirling and Perth discussion groups, support for new development was raised and the following points were gathered:
- Both public and private representatives accepted the difficulties associated with facilitating new development in existing centres;
- The issue could be properly linked to wider strategies, e.g. area-wide regeneration, enabling public/ private partnership funding; in smaller scale circumstances however, this approach was unlikely to be practical;
- Compulsory purchase was one possible approach, but disadvantages include cost, timescale and lack of certainty;
- There was a general agreement that a more positive approach to facilitate development was necessary and the key issue was not necessarily the availability of sites, but the will to make things happen;
- Overview and potential simplification of CPO procedures would be helpful (similar to that ongoing in England and Wales).
5.23 The Council in Perth has been actively involved in the preparation of a retail strategy for the town centre, particularly in the light of the St Catherine's Park decision. A key issue for the Council is one of balance, and in particular the extent to which all new development should be directed towards the main town in the Council area, potentially to the disadvantage of smaller, more rural centres. The participants recognised the need for the Council to deliver suitable opportunity sites within the town centre, capable of improving the competition, range and offer within the town, in order to compete with centres such as Dundee, Edinburgh and Glasgow.
5.24 The issue of a "level playing field" was raised in relation to car parking. Car parking at out-of-centre locations is often free, whereas town centre parking is charged.
5.25 Further, discussion amongst the planning solicitors raised the restrictive boundaries that contain town centres and the need for potential opportunities to be identified. Concern was also expressed in relation to local authorities' ability to deliver central sites given the complexities involved. Reference was made to the increased likelihood of local authorities selecting sites where they have a land owning interest. A further difficulty could be the issue of local authority land coming forward too slowly, when retail sites are often market driven requiring relatively quick and incisive action. The use of CPO powers was discussed, but some concerns were raised that CPO involves the surrender of one commercial interest for the benefit of another.
5.26 From the interviews with individuals, support for new development brought different views from the different sectors.
5.27 Local authority interviewees cited a range of examples where town centre strategies had been prepared, although there were limited cases of such strategies resulting in the actual delivery and implementation of new development. The approach is often based on identification of opportunity sites within Local Plans, with a range of criteria attached, but with no clear delivery mechanisms. The issue of tension between planning departments and estates departments was raised in relation to delivering town centre development opportunities, and this is a common concern. A number of examples were cited by local authority interviewees, and similarly this issue was raised by private sector interviewees.
5.28 The NPPG has, however, been positive in encouraging various town centre initiatives (e.g. environmental improvement schemes, business improvement/ advice schemes, public realm improvements, etc). Town centre management companies featured prominently in local authority interviewee responses, although these are often related to marketing, minor physical improvement works, maintenance, etc rather than revenue-generating development schemes.
5.29 The private sector interviewees referred to difficulties experienced by undersupplied/ over demanded centres such as Edinburgh city centre with the upward only expectation of institutions in relation to rental income. This in turn prices out retailers affordability and leaves a blight of expectation hanging over properties. In the mean time, no new floor space is provided and retail shifts to off-centre locations.
5.30 There is scepticism in the private sector in relation to local authority town centre strategies as referred to in NPPG8. In any event, however, these strategies must be capable of recognising the rapidly changing nature of retail formats and unless they can do this, they are unable to deal effectively with this dynamic sector. Scepticism was also raised in the developers sector in relation to developers being involved in partnerships with local authorities. Developers feel that they are often excluded from consultation exercises on Town Centre issues.
5.31 Some supplemental enquiries with a sample of leading Scottish regeneration agencies/companies brought the role of retail/commercial development to the fore, in regeneration projects. Most felt that the "early phase catalyst" was a positive effect of retail with higher land values assisting with the strain of a deficit cash-flow, often affected by decontamination and land assembly/infrastructure costs. However, others suggested that the inclusion of retail centres could conversely be seen as a later phase complementary service to an established new urban quarter and some comments referred to the possibilities of lower decontamination costs if a simple retail car park was required, as opposed to a use such as residential. But the general view amongst regeneration specialists was positive towards commercial/retail development as a focus and catalyst for further renewal and higher density development.
Site Development Issues - Summary
5.32 There are no direct references to the use of compulsory purchase powers to facilitate site assembly in NPPG8. Policy guidance merely encourages a co-operative approach between the private sector and local authorities to the identification and development of suitable sites.
5.33 Interviews with advisors and lawyers involved in the development process revealed dissatisfaction with the sequential testing process in particular the uncertainty over whether potential sites are available for development. The threat, or use, of compulsory purchase powers would assist this process.
5.34 Few authorities have used or are contemplating using compulsory purchase powers to assist in site assembly in pursuance of NPPG8 objectives. Developers consider that the compulsory purchase process is too long. Nevertheless, local authorities have the powers and can take the initiative in assembling town/city centre sites for retail development. There is scope to review Section 189 of the principal Planning Statute to simplify and streamline use of compulsory purchase powers.
5.35 There is support amongst local authorities for greater emphasis in national guidance about the positive/proactive role for authorities in land assembly. The "back-to-back" approach is supported but few authorities have experience of this process.
5.36 A recent compulsory purchase case for land assembly in Glasgow city centre that was challenged in court faltered not because the principle of acquisition was wrong but rather that the processes followed in that particular case had shortcomings.
Support For New Development - Implications For Policy
5.37 We highlight the following implications for policy, in conclusion to this section:-
SD1 - Sequential Site Identification Prior To Submission Of Proposals
5.38 Guidance should require local planning authorities to undertake a sequential approach to site identification in advance of development proposals coming forward rather than retrospectively. As part of their development plan preparation and survey work, local planning authorities should undertake systematic site searches for potential retail development sites in cities/towns. This could be done with the assistance of the private sector and would underpin the policy approach taken in the Development Plan.
SD2 - Best Practice Guidance Required For Site Development Issues
5.39 Clearer advice and best practice guidance is needed about:
- Preparation and implementation of town centre strategies;
- identification of sites in consultation with the private sector;
- site assembly; in particular the use of "back-to-back" approaches to development proposals.
These are fundamental issues that go to the heart of facilitating successful retail centres. Planning Authorities need to understand (or remind themselves) how sites are identified and assembled and how the private and public sectors can work together successfully to implement change in town and city centres.
SD3 - Reference Required To The Use Of Compulsory Purchase In Site Assembly
5.40 NPPG8 and PAN59 should emphasise the important role of compulsory purchase powers in facilitating site assembly and state the Executive's endorsement in principle of this approach. The perception by local planning authorities is that the compulsory purchase process is long, costly (both financially and in staff resources) and complicated. These perceptions need to be corrected and strong, firm advice in national advice should be given.
SD4 - Annual Register And Review Of Potential Retail Sites
5.41 Local planning authorities should monitor and identify suitable retail development opportunities on an annual register and if none are identified, justify this position to the Executive. This would be akin to a housing land supply audit. A much more pro-active stance needs to be taken by planning authorities in identifying opportunities for growth and reviewing these on an annual basis. The private sector and consultants can be harnessed to give their input.
SD5 - Review Section 189, Town And Country Planning (Scotland) Act 1997
5.42 Review section 189 of the principal Act and consider replacing current requirements with broader, simpler ones. There is a need to move away from the ties to the development plan and planning consent requirements that can often take too long to achieve in the face of dynamic, fast-moving retail requirements. Planning authorities should be able to use compulsory purchase powers flexibly and timeously without getting bogged down in what may be perceived as 'legalistic requirements'.
SD6 - Streamline Compulsory Purchase Process
5.43 Streamline and shorten the compulsory purchase process under the Town and Country Planning (Scotland) Act. The compulsory purchase process can often take too long to complete and this does not assist retail development which requires quick decisions. The time periods for challenges and confirmation need to shortened.
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