Pandemic, real estate, cities and legal considerations

Answer

Even though we expect some return to workplaces as restrictions ease, our towns and cities have been changed as a result of the pandemic. As well as practical considerations about how buildings are used going forward, and the impacts on the communities we live and work in, the changing nature of towns and cities raises legal questions for planners, employers, real estate owners and developers.

Real estate lawyers advise on work such as buying and selling land or property, or leasing premises. Their work can also play a part in other legal areas such as corporate M&A and they can work closely with other legal professionals to help obtain planning permission for new developments, and secure funding for real estate projects. Some lawyers also help to resolve property disputes. Acting for a range of clients which can include developers, landlords, investors and public sector organisations, real estate lawyers are helping many sectors of the industry navigate the changing nature of real estate in our towns and cities.

Flexible office space and co-working

A rise in flexible working doesn’t just impact employment law, but also raises questions about the future of office space and workplaces. We had already seen a rise in co-working, including here in Belfast where several new spaces have opened in recent years, but the pandemic will likely accelerate this trend. The increased flexibility, shorter occupancy terms and additional services co-working arrangements often offer all impact the types of agreement and legal documentation associated with taking up space. For example, determining whether a lease or license to occupy is most appropriate is one area commercial property lawyers may help with. Landlords or building owners considering converting their buildings for co-working will also have to consider a number of legal issues and may need planning advice.

Repurposing and changing use

With retail vacancies, particularly for large department stores, there is a lot of discussion about what happens to the high street and how vacant space can be repurposed. Leisure and hospitality, shared office space and residential development is starting to step in to revive some vacant space. New, innovative approaches to town centre redevelopment are exciting opportunities, but can require complex planning advice and engagement.

Understanding a property’s use class, permitted development rights and any limitations for development or alterations is key to successful repurposing. Each jurisdiction in the UK has its own planning regime so understanding what is possible in Northern Ireland, for example, won’t necessarily mean the same approach can be taken in England, Scotland or Wales.

Legal jurisdiction aside, where a tenant wants to look at using their space differently, alterations will also depend on the lease terms and potentially require landlord consent, and property lawyers can help clients to understand leases and navigate the options to vary them.

City centre living

The changing landscape of cities is also likely to bring about new kinds of development in cities with more residential development emerging.

Here in Northern Ireland, city centre living generally is in its infancy. While we’re seeing some residential development schemes underway, there is a long way to go. We’ve seen increased hotel and student accommodation developments in recent years but few residential projects so far. It’s now recognised that increasing the population in the city centre is key to its sustainability and it’s great to see ambitious targets to increase Belfast’s city centre population.

Increased residential development in city centres not only potentially helps to repurpose vacant space but also supports the viability of other non-residential uses in the area, as local businesses in retail and leisure benefit from more local residents. The reduction in commuting due to people living closer to city centre workplaces may also help the greening of our towns and cities.

Sustainability

Changing the way city centres are used can also help them to become greener. While this is a complex challenge, reducing pollution from traffic and making older buildings more sustainable are two ways this can be supported.

Sustainability doesn’t just come from changing how we use our cities, or by increasing our use of technology and renewable energy, but also from changes in finance, planning, development and construction.

Law firms therefore need to keep pace with how development practices are changing, helping their clients adapt to the market trends while also keeping up to date with legislation changes. Real estate lawyers can help to ensure repurposing or new development meet the evolving needs of the affected communities as well as any changing planning requirements.

Mary-Jane Byrne is an associate in the real estate team at TLT.