Breathing new life into vacant property

Bringing abandoned or empty properties back into productive use remains challenging on both the local and national level. Measures are, however, available to local authorities and community groups north and south of the border to promote much-needed regeneration. A rethink is long overdue as to how land is best used across the UK. Brexit, Covid-19, flexible working patterns, changed shopping habits and increasing financial pressures on tenants of high street commercial property are well documented and visible up and down the country. While mixed-use development is seen as a silver bullet, retrofitting vacant commercial property for residential use can be  expensive and unfeasible. The housing market continues to experience ever-increasing rents and a limited supply of new, affordable housing, with the Scottish government formally declaring a housing emergency in May 2024. Major projects are certainly in the offing, but what tools are available to deliver much-needed rejuvenation now? England: high street rental auctions Much has already been published on the recently introduced tenancy auctions in England. As of 2 December 2024, regulations made pursuant to the Levelling-up and Regeneration Act 2023 give English local authorities power to auction new tenancies of certain vacant commercial premises in designated town centres or high streets without landlord consent. Designed to reduce vacancies and enhance amenity, the implications for owners and landlords are nevertheless massive. A tight timetable is prescribed in the regulations, which requires service of notice on a landlord of the intended tenancy auction, preparing the auction pack and marketing, among other things. While a laudable objective, with only £1m in committed government funding, the extent to which stretched local authorities will use such powers remains to be seen. Scotland: ownerless property transfer scheme Legal practitioners will be familiar with the King’s and Lord Treasurer’s Remembrancer, the Crown’s representative in Scotland authorised to deal with “ownerless” property. On 1 March 2024, the KLTR launched the ownerless property transfer scheme, a new strategy promoting acquisition by public bodies, local authorities and some community bodies of land or buildings valued at £500,000 or less that are legally ownerless and in disrepair, derelict and often hazardous. Successful applicants may be able to acquire such land or buildings for a nominal value and (subject to meeting the KLTR’s legal costs) repurpose them for local benefit. Community engagement, public interest and sustainability are key pillars of the strategy. Any proposals must demonstrate strong local support, show a comprehensive business case and are subject to scrutiny prior to approval. Falkirk Council recently announced the successful acquisition via this initiative of the Royal Hotel, which had been empty for more than two decades, to support the regeneration of Slamannan village centre. Scotland: community right to buy Community right to buy has been in use in Scotland for 20 years. There are four community right to buy powers in Scotland: a community right to register an interest in land or buildings, and be given right of first refusal to acquire it/them on being offered for sale; the “crofting” right to buy, giving crofting communities the right to acquire and control the croft land where they live and work; the community right to buy land deemed abandoned, neglected or detrimental to the environmental wellbeing of the community; and the community right to buy land or buildings to further the achievement of sustainable development. While a range of avenues to community ownership exist in Scotland, all of which have been welcomed and well publicised on entering into force, uptake (and the number of successful purchases) has been low. Contrasted with private sales, the process is lengthy and rigorous (as is only right, considering the constraints which can be placed on a landowner should the application be successful). Commentary around these community rights to buy suggests the bar is too high for communities to surmount. Barriers such as difficulty raising the necessary funding, and navigating a highly complex and time-consuming process (often requiring legal input and support) have been identified, along with a need for a more streamlined process. We wait to see if this materialises. Scotland: Vacant and Derelict Land Taskforce A 2020 report identified almost 11,000 hectares of vacant and derelict urban land throughout Scotland, a legacy of the country’s industrial past. With the impact disproportionately felt in disadvantaged areas, the Scottish Land Commission and the Scottish Environment Protection Agency established this task force in 2018 with a mission statement of bringing abandoned vacant and derelict land back into productive use. This brought together public bodies, business and third-sector organisations with a remit of reversing the adverse impact such sites have on communities. An independent report prepared by Ryden published in 2024 shows steady progress being made, and a downward trend in the overall figures. The report does, however, caution that current economic and financial conditions could impede progress going forward. These ambitious initiatives to regenerate the high street, land and properties are to be welcomed. At a time when occupiers’ priorities are changing, with a focus on amenity-rich, net-zero spaces, these initiatives present an opportunity to bring existing spaces back to life in profitable form. They present a valuable opportunity for community-led regeneration, particularly in economically disadvantaged areas, and the prospect of improved fortunes. For Scotland, 2025 will see publication of the results of the Scottish government’s review of existing community right to buy powers, and we wait to see what recommendations will follow to build on the progress to date. Gethin Bowen is an associate at Dentons Image © Richard Gardner/Shutterstock