CIL – Could charges stifle further development in Leeds?
“THE proof will be in the pudding” of the knock-on effect of the Community Infrastructure Levy (CIL), according to a commercial property expert.
“In a nutshell, it is an additional cost for the landowner or developer,” commercial property lawyer Mat Haynes of Leeds-based Milners Solicitors said.
Last week, Leeds City Council unveiled its new planning strategy which will underpin all future development and growth in Leeds. The Core Strategy, which will provide a 15-year planning framework to guide all development across the whole Leeds district. The council also voted to introduce a new CIL on new developments in the city as a new way of collecting contributions from developers for infrastructure facilities such as transport, education, the Leeds Flood Alleviation scheme or green space.
Speaking about whether the charges could stifle further development in Leeds, Haynes said: “It is just going to make development as little bit more expensive, but the proof will be in the pudding. It is up to the developer to make the decision.
“Councils will be looking at what other councils are doing and will make sure they are competitive to make it look more attractive to come to Leeds.”
CIL will affect residential, supermarket, comparison retail and office developments.
• Housing developers can expect to be charged £90 per sqm in the north of Leeds, varying between £5 and £45 per sq m. in all other areas of the Leeds District
• Supermarkets of 500 sq m and above will be required to pay between £110 and £175 per sq m depending upon their location within or outside the city centre
• Office developments in the city centre will be charged £35 per sq m. of floor space
• Publicly funded developments or those for not-for-profit organisations will not be subject to a charge – all other uses will pay £5 per sq m.
CIL funding will contribute to local infrastructure schemes, including: River Aire Flood Alleviation Scheme, secondary and primary education, community sports facilities, public realm improvements, and public health facilities.
Haynes said: “Not a lot has happened in Leeds city centre in terms of office development and the council recognise that, so have kept the CIL low for offices in the city centre.
“But however you look at it, it is additional money people have to take account of.”
Leeds City Council intends to implement the CIL from 6 April 2015.
John Brooks, the Leeds office director of planning consultancy Turley, said that developers in Leeds need to take note that the Council’s decision to go ahead with CIL is irreversible.
“The General Election is unlikely to alter its course either. So, to avoid incurring this additional cost for existing projects, applications need to be submitted this side of Christmas.”
Amanda Beresford, partner and head of planning at Shulmans, added: “Where it is not possible to get planning permission before CIL applies it is important to ensure that all contracts, options and development agreements relating to relevant developments take account of the liability to pay CIL and any calculations of CIL take full account of any available exemptions in assessing viability.”
