Tag: farm diversification

The economics of many farm businesses have over recent times encouraged many diversifications. At Robinson & Hall, our team of surveyors and planners has seen a vast array of diversification, but all have required careful coordination and planning.

There are prior approval processes for reuse of agricultural buildings which ought to allow a simple approval process for certain categories of development, but there are conditions and hoops to jump through. The small print can make or break a viable diversification, so we advise taking professional advice.

A planning feasibility study is always a good starting point to ensure site constraints and planning policies are fully understood before starting out on the development process and committing time, energy and funds to a scheme.

Where a full planning application is required, it is often imperative to consult the local authority via a pre-application enquiry as whilst the policy is written in black and white, it is for the local authority officers to interpret their policies, and we often see that diversification schemes do not fit neatly into every policy. One such example and contradiction could be:

Policies directing employment growth to be sited within defined employment areas.With other policies encouraging reuse of redundant buildings and/or employment opportunities in the rural economy, it is imperative to get officer opinion (as far as is feasible) to verify our interpretation of the multitude of national and local policies and importantly how the officers weigh up any conflicting or judgemental policies.

As there are many considerations when selecting your diversification project, it is important not to rush this decision and ensure you have considered a number of the below key factors:

Firstly, why?

Whether you wish to improve the tax efficiency of the business, explore a specific new interest or simply generate potential additional income streams, it is important that the decision is made for the right reason. This new venture will sit alongside your established farm enterprise, however it cannot compensate for an under-performing core business.

High level considerations

Once the decision is made to diversify, choosing the asset is important, i.e. the vacant/ redundant building, where it is situated and how it will impact on the current farming operation. Does the barn/ land have suitable access and services and what type of planning will be required?

Depending on the diversification, consideration may need to be given to market demand and competition, funding availability, the target audience, and the availability of workforce.

Financial aspects

Now the asset has been identified, what will it cost to change the use, whether that be conversion to an office/dwelling, servicing the glamping pods, or setting up the wedding venue?

Consideration will also need to be given to tax implications, cost of marketing, insurance, and other matters such as planning and professional services.

The green light

The once pipe dream is now inching towards reality. It is important to focus the attention on ensuring this new business venture succeeds, whilst the core business operations do not suffer.

If you require advice or are considering a diversification then please get in touch.

Why diversify?

The phasing out of payments under the Basic Payment Scheme has resulted in many farmers looking for ways to protect their business income for future generations.

Through the re-use of redundant/surplus buildings or land of low productivity, diversification can open new sources of revenue that does not rely on the day-to-day agricultural enterprise, add value to assets, provide a new challenge, create new jobs and allow new business entrants in the form of younger generations/family members.

Farm diversification can come in many forms such as:

• Farm shops
• Wedding venues
• Holiday lets
• Camping / glamping sites
• Self-storage units (see our commercial article on page x for more information)
• Light industrial/workshop units (see our commercial article on page x for more information)
• Dog walking fields
• Renewable energy
• Residential conversions

One of the first steps when considering a farm diversification project should be to assess the planning options available and, if necessary, prepare a planning strategy.

Many proposals utilising existing agricultural buildings may fall under Permitted Development Rights (PDR). Therefore, it is important to understand at an early stage in the project whether full planning permission for change of use is required or whether PDR can be used.

When you can use Permitted Development Rights:

Part 3 of The Town and Country Planning (General Permitted Development) (England) Order focusses on changes of use and in particular Classes Q, R and S focus on the change of use of agricultural buildings.

Class Q enables the conversion of agricultural buildings to up to five new dwellings, the floor space is limited at 465 sqm and the structure of the building must be confirmed as capable for conversion. You also must be able to evidence that the building was previously used for agriculture on or before 20^th March 2013.

Class R enables the conversion of agricultural buildings to a flexible commercial use up to 500 sqm and the building must have been last used for agriculture on or before 3^rd July 2012.

Class S enables the conversion of agricultural buildings to state-funded schools or registered nurseries providing the building was used for agriculture on or before 20^th March 2013 and the change of use does not exceed 500 sqm.

The benefit of being able to use PDR to diversify is it is a simpler, quicker and cheaper way to get farm development through the planning system.  

Other factors to consider:

Many sites that offer farm diversification opportunities are located within the open countryside, where planning permission for new buildings is contrary to policy and difficult to obtain. In addition, if a site is located within the Green Belt, a conservation area, a national park or an Area of Outstanding Natural Beauty, it is further restricted by the National Planning Policy Framework (NPPF) and various measures shall need to be taken to ensure the development is acceptable.

Liaising with the local planning authority:

Where PDR is not an option, it is beneficial to engage with the Council at the earliest opportunity and discuss your proposals at a pre-application stage. It is also helpful to engage with your local Parish Council and adjoining landowners and neighbours to gain support and address any concerns prior to the submission of an application.

Often, planning officers are not familiar with the day-to-day running of a farm and how agricultural businesses work. It can be helpful to your application to invite officers to gain an understanding of the enterprise when undertaking their site visit or to submit additional explanatory information as part of an application submission.

Key points to remember:

• Timescales! We are seeing vast delays within the planning system and with various local planning authorities. Whilst full planning applications should have a determination period of 8 weeks, we are seeing these stretch to 12-16 weeks and in some cases 6 months.

• Third party reports/costs. To ensure compliance with both local and national planning policies, local planning authorities may request the submission of third party information such as ecological heritage, transport, air quality and noise assessments as well as landscaping schemes. These are an additional cost to consider when preparing a planning application.

• Diversification should not be a distraction from the main farming operation. It is important to remember diversifying should be supplementary to the farm enterprise.

We have years of experience successfully helping farmers to diversify their farm business. We can help from start to finish and guide you through the process.

For further information or to find out how we can help you, please contact Shannon Fuller.