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Covid-19 Recovery: Diversifying, selling land and the planning pitfalls

The impact of coronavirus on the farming and agriculture industry has been significant, prompting Defra and the Department for International Trade to launch a ‘bounce back plan’ but for some farming businesses, it is too little too late.

Paul Smith, managing director at the Strategic Land Group
Paul Smith, managing director at the Strategic Land Group

The Covid-19 pandemic was the latest curveball in a series of crises, including extreme weather and flooding, entrenching existing financial pressures and heralding a new set of operational challenges.

 

Diversification has been crucial in securing the survival of countless farm businesses over the years, with holiday lets, ’pick-your-own’ options and even events, yet those services were also badly hit.

 

For families who spent lockdown together, it created the space for conversations about growth plans and diversification, as well as succession planning.

 

For some, adversity has stimulated new ideas and opportunities, while, for others, the desire to continue farming has dwindled.


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Whatever the route forward, there is much to consider - particularly when it comes to land and buildings, making sure that any works meet the required guidelines and planning permissions. Getting this wrong could spell disaster, with the potential for large penalties.

 

Diversification will be on the cards for many - mirroring the trend we have seen across other industries, pivoting services and products for the ‘new normal’.

 

Farmers who saw prices collapse with the closure of restaurants and cafes may be thinking about different routes to market, and whether disused facilities and old buildings can be improved to facilitate necessary diversification.

 

Before committing to any building works, or proceeding with the sale of farm land, there are several points to consider:

  • Tread carefully with Permitted Development Rights

Permitted Development Rights allow some works to be carried out without applying to the local authority for permission - but farmers should take care to understand exactly what can and cannot be carried out.

 

It is also worth noting that some jobs will mean other authorities such as the Environment Agency will need to be notified.

 

Common improvement works permitted under PDR include hard surfacing and introducing access routes, and some buildings essential to the purposes of agriculture, such as stores for example.

 

However, the rules on new development are stringent - take planning advice before attempting to erect any new buildings to avoid costly financial penalties down the line.

 

The PDR regulations do allow for a large amount of leeway, which many farmers will be keen to take advantage of.

 

For example, buildings that are not used can secure a change of use and be transformed into a home instead - while the number of dwellings is restricted, the prospect of turning under-used assets into holiday cottages, for example, could bring in much-needed additional income.

  • Building on agricultural land

We have seen a 180 per cent increase in enquiries from landowners looking to sell land during the past 12 months, which we expect will rise further given the impact of coronavirus.

 

Farmers who are keen to build on agricultural land should make sure that they take professional planning advice well in advance - a bad decision can rule out development and reduce a site’s value significantly.

 

For example, a through-road in the wrong place, or the incorrect routing of drainage could limit the land’s future potential.

 

The strife caused by Covid-19 has encouraged many farmers to think outside the box, considering options that may not have considered before - the potential to sell land for housing development is one of them. Early advice is very important.

 

There are countless incorrect assumptions around the size of a plot and its location - small plots shouldn’t be discounted, and key things to consider are access and proximity to utilities.

 

Land that is located close to existing urban areas is likely to see significant interest from house builders especially once planning permission is in place.

  • Engage with the council

When it comes to selling land for development, strategic engagement with the local authority will be essential.

 

All councils are obligated to have a Local Plan in place, providing an adequate number of sites to meet future need. Farmers should find out whether their council has a Local Plan in place - it may be that their land can form an allocation within the plan.

 

A land promoter will be able to complete an early appraisal of land free of charge, outlining potential uses, whether sale for agricultural land, sale for development or something else entirely.

  • Draw on your network

Farmers who are considering selling their land should first speak to colleagues, connections and neighbours - particularly where land is for agricultural use.

 

Securing a local sale would save expensive marketing fees and time and money spent on readying the land for sale.

 

The coronavirus crisis will undoubtedly mean that some farm buildings and estates will take longer to divest, so any strategies to speed up the process should be welcomed.

  • Do not be disheartened if planning is refused

Securing planning can be a stressful endeavour - if your plans have been turned down, that does not mean it is off the table.

 

Take planning advice and return with a revised approach, taking into account the concerns and altering proposals accordingly.

 

If a site is judged unsuitable for housing, it may well be appropriate for other uses, such as a care home or residential home - a sector that is hugely under-serviced and in high demand.

 

As the UK begins to exit lockdown, it is clear that there are difficult times ahead.

 

Whatever the strategy, whether that is diversification and new services, redevelopment and change of use of agricultural buildings, or divesting land altogether, it is vital to take early advice to prevent any costly mistakes and give your recovery plans the best chance of success.

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