What to do with a spare bit of land - Development

[Hobo]

Just purchased a piece of land on which it looks like 14 apartments will be built. However, the land itself goes to a point at one end & there is a spare piece (not required for the apartments) which measure around 18mx7m (triangular). Theres no point squishing any more apartments on the plot & using this for car parking as the development would then fall into the remit of 'social housing'.

I'm thinking whether it is possible to build a shop & get a franchise like subway, etc in. The development is town centre & approx. 50m from the local school & enroute (by foot) to a decent size football club so would think something food based would do well as there is only a couple of local sandwich shops in the area.

Anyone any ideas ? How easy is it to get planning for a shop ? Build costs would be minimal so thats not the concern.

[Diddy]

Subway (as with most companies of this sort) have a property department who will give you a pretty quick answer as to whether a site would be of interest to them. In terms of whether the site could gain planning its entirely down to the local plan of the town/city you are in, and what the area is zoned for. A quick consultation with a local commercial property adviser could help you out with your initial enquiries - or alternatively make an appointment with someone at the planning office yourself. From a few instances I've seen recently of people developing out their own site/starting businesses and taking leases, I would strongly advise a bit of professional advice if you aren't well associated with the market. One example I saw recently was a young guy taking a 25 year lease on bar premises, at £40k per annum over the market rent!!! (Market rent circa £80k!) Professional fees for an agent to advise him what he should have been paying and to negotiate him a substantially better deal would have cost him c.£8k.

Edited by Diddy on Thursday 27th December 22:08

Edited by Diddy on Thursday 27th December 22:08

[Sam_68]

Hobo said:

How easy is it to get planning for a shop?

I'd tend to disagree with Diddy... regardless of Planning zoning, any half-competent Architect or Planning Consultant should be able to make a case for a shop on such a site. 'Sustainability' of development is the big buzzword these days - the whole idea being that houses need other facilities and infrastructure around them in order to ensure a vibrant community and avoid the need for residents to drive miles to find a shop, or school, or whatever.

I'm sure you'll be able to find a non-residential use that would be welcomed on the site, though if you need to ask these sorts of questions, you might be better seeking guidance from a town planner or planning consultant as to what is most suitable for the particular neighbourhood.

[Hobo]

I will be speaking with our architect & planning consultant on return from christmas hols however just wanted to try & get a feel for whether something along the lines of this was a possibility.

So... assuming a shop would be ok. What kind ? There's not a lot in the area but I do know that a major housebuilder has just aquired a site less than 2 miles away which is for over a hundred plots. I'm torn between catering for the daytime trade, ie Subway, or for the evening trade, ie Dominos/Pizza Hut. Alternatively just some some of general store could be ok.

I stress I do not want to run the store/shop myself, just get a rental off it from someone else.

[Sam_68]

haworthlloyd1 said:

... a tesco express if it will fit on there

It won't - not on an 18m x 7m triangle.

Your biggest problem is going to be finding something that fits and doesn't generate so much traffic that it will cause parking problems, but that's for your Architect to solve.

[Hobo]

What are the parking requirements for shops/takeaways, etc ? Surely if you want to say put a subway store there then you don't need to provide customer parking ?

[UpTheIron]

Hobo said:

What are the parking requirements for shops/takeaways, etc ? Surely if you want to say put a subway store there then you don't need to provide customer parking ?

No, but I wouldn't buy a house/apartment/flat on a road that had a Subway/similar without parking...

[Hobo]

I suppose the more despecable developers would wait until the apartments had sold before building the shop, etc, ie just keep the land aside for a year or so

[johnfm]

Building flats in Leeds...in 2008...that triangular piece of land would be the least of my worries.

[Hobo]

Its not Leeds this development. I agree thats there's a lot going up in this area & unless you have a really good location (and product) that you may struggle to shift them. Saying that, I'm not sure I agree with all the hype about the 'big crash coming'.

(for JohnFM) On a seperate note, re that land I mentioned months ago that, it was actually in Bramhope (where I understand you live) & has been sold on a 'subject to planning' basis for £8 million !!! We'll see what happens I suspect in the coming year or so. Since the guy who owns it works for me then I suspect I better start looking for a replacement

[Sam_68]

Hobo said:

...I'm not sure I agree with all the hype about the 'big crash coming'.

You're on your own amongst the property developers I know, then!

Every large housebuilder I am aware of (including the one I work for) has put a freeze on all new land deals unless they can demonstrate a huge margin at the moment.

[Hobo]

And what classes as a 'huge' profit ? I've always worked on wanting to make between 20-25% & will continue to do so. I don't think of this as 'huge' but give have adequate margin for a downward movement.

[johnfm]

Hobo said:

Its not Leeds this development. I agree thats there's a lot going up in this area & unless you have a really good location (and product) that you may struggle to shift them. Saying that, I'm not sure I agree with all the hype about the 'big crash coming'.

(for JohnFM) On a seperate note, re that land I mentioned months ago that, it was actually in Bramhope (where I understand you live) & has been sold on a 'subject to planning' basis for £8 million !!! We'll see what happens I suspect in the coming year or so. Since the guy who owns it works for me then I suspect I better start looking for a replacement

Good luck to him. Land in Bramhope with potential. I guess he sold it to Erkulis - they seem to have bramhope well covered.

Happy New Year BTW.

[Simpo Two]

Be different - how about a Post Office that sells food/drink as well?

[Sam_68]

Hobo said:

And what classes as a 'huge' profit ? I've always worked on wanting to make between 20-25% & will continue to do so.

I can't speak for other companies, but we have been told to forget anything less than 35% at the moment, and then only with a very detailed and quite pessimistic financial viability.

Up until recently (ie. 2-3 months ago), we were working on 21-23% as the normal minimum, though some of big players were down as low as 16-17% (and cooking the books on the viabilities to get there!).

If you're working on 20% for current land acquisitions, expect to make a substantial loss.