Retail regeneration – how much can councils control the future of their high streets?

An enormous change has taken place in retail in recent years; the traditional pattern of shopping in physical stores has been profoundly changed by the growth of online shopping and Britain’s high streets have become increasingly empty and tired.

In order to consider what role local authorities can play to encourage thriving town centres, the way city centres and the high street have changed over the years must be considered.

Recent studies propose activity-based community gathering places as a solution, where retail comprises part of a wider range of uses and activities including:

  • green space;
  • leisure;
  • arts and culture; and
  • health and social care services;

Which combined with social housing create a space based on social and community interactions, in short changing the high street to a ‘leisure and social destination’.

Local government, central government and retailers all have a part to play in achieving this vision.

The policies and priorities of a local authority can have a significant impact on the development of a vision for a particular area. Ways in which a local authority will have a role in regenerating local areas include:

  • as a landowner, both making effective use of its land and making effective land disposal;
  • when exercising regulatory functions;
  • as a service provider;
  • when complying with its duties and exercising its powers relating to community involvement.

A high street health check can identify actions which need to be taken to ensure a successful future, highlighting any potential collaborations or early wins to implement as part of repositioning and making it robust. Some solutions to improve the health of a high street include:

  • improving and highlighting public facilities and the signs to them;
  • improving street lighting, perhaps installing LED lighting;
  • looking at access hours for facilities;
  • using powers to tackle anti-social behaviour;
  • looking at parking facilities – how easy is it to access the town centre, is parking being utilised by leisure visitors or by local office workers;
  • planning for green spaces, both appealing to visitors and promoting biodiversity.

Any legal obligations and constraints can affect the actions a local authority can take and impact the outcome of a regeneration vision. As long as the local authority is aware of the legal requirements and addresses them at the outset of developing strategies, and throughout the course of delivering the strategies, they do not need to cause problems.

When considering a vision for retail regeneration it is also important to consider how costs will be met for example by an additional rates levy or contractually by obtaining contributions akin to service charge from occupiers/retailer.

If there are business improvement districts in the area, that can be an effective way of raising funds through levies to provide services in the business improvement district areas. The government recently launched its Future High Streets Fund of £675m to provide co-funding towards capital projects for the regeneration of town centres, contributing up to £25m to each successful bidder.

While the deadline for the submission of proposals for the current phase has now passed, the details and assessment criteria of a second round is expected sometime from 2020, giving local authorities another opportunity to express their interest.

Business rates can provide an important source of income for local authorities but the expense of paying them can affect the economic viability of businesses.  It should be considered whether effective use of business rates is being made and what actions might be appropriate to take to help those who might be struggling to cope with the impact of business rates.

While some relief from business rates for charities is mandatory, a local authority might consider what it makes of its powers to provide discretionary rate relief. A report published by the British Retail Consortium in 2010, ‘21st Century High Streets: What next for Britain’s town centres?’, said that business rates were widely accepted as a disproportionate cost.

The report said that business rates should be affordable and provide cost certainty.  Nine years later, how close are we to meeting that objective?

As a landowner, a local authority is in a strong position to contribute to the success of its area with powers to acquire, appropriate and dispose of land.  It is important for a local authority to ensure that it makes full use of its powers and that it complies with any requirements associated with them.

Section 120 of the Local Government Act 1972 gives a local authority power to acquire land by agreement and section 121 makes provision for the Minister to authorise a local authority to acquire land compulsorily.

Section 226 of the Town and Country Planning Act 1990 makes provision for the Secretary of State to authorise a local authority to acquire land in its area compulsorily if the authority thinks that the acquisition will facilitate the carrying out of development, redevelopment or improvement or that it is required for a purpose necessary to achieve in the interests of the proper planning of an area in which the land is situated.

Also, if land held for a particular purpose is no longer required for that purpose, a local authority has power to appropriate it to use it for a different purpose.  There is a power of appropriation in section 122 of the Local Government Act 1972.  A local authority should also consider its powers to dispose of land and how this might facilitate growth and regeneration, all the while complying with State aid and best consideration rules.

Another angle is how a local authority provides its services and whether it should adapt these to reflect changes to the local environment.  For example, if people regard the high street and town centre as a place to go for facilities and services, rather than as a place to shop, perhaps a local authority could consider if its communities would find it convenient to access the local authority’s services there.

The responsibilities that local authorities have for serving the public and the contacts they have with their communities and with other public bodies and organisations in the private sector make them well placed to play key roles in place shaping.  The actions they could take to contribute to redesigning space include:

  • Regeneration activities;
  • Collaboration with others bring neglected spaces into use;
  • Pop-up facilities;
  • Organising events.

One approach to facilitate the above is meanwhile use of land which allows the temporary occupation of land by occupiers who would not usually be able to pay commercial rents for the land.  This enables the occupiers to make use of the land on a short-term basis and keeps the area economically active whilst the landlord looks for an occupier who will be able to pay a commercial rent. Meanwhile use arrangements have been used to provide premises for meetings, training, rehearsals, exhibitions and pop-up shops. The Ministry of Housing, Communities and Local Government has published a template for a meanwhile use lease and associated guidance.

While there is understandable concern about the future of retail and the future health of town and city centres, there is much potential for areas to survive and thrive and there is a clear key role that local authorities can play in achieving this.

Tiffany Cloynes
Partner, Geldards.


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