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The planning implications of micro-fulfilment centres in urban areas

As demand for fast delivery grows, Matt Williamson considers the planning implications of the anticipated increase in micro-fulfilment centres.

As the demand for rapid delivery grows, we consider the planning implications of the anticipated increase in micro-fulfilment centres (MFCs) in urban areas.

The idea of micro-fulfilment is to place automated fulfilment facilities in accessible urban spots, closer to the end consumer. COVID-19 has certainly altered consumer shopping habits, with store closure and restrictions causing a surge of online sales and altering supply chains. For some consumers and retail operators, the emphasis is more on “clicks” rather than “bricks” but the country still needs the infrastructure in place to service the demands of those modern consumers.

Consequently, more retailers are expected to utilise MFCs to meet consumer demands with greater rapidity and convenience. Retailers also argue that MFCs increase the efficiency of delivery by reducing the number of separate deliveries to consumer households (and, in turn, potentially help to reduce urban emission levels).

Indeed, warehouse uptake of differing profiles is on the rise but, depending on the purpose of the warehouse, retailers need to assess whether the available sites are suitable. Retailers, 3PLs and investors could repurpose unused land in urban areas to create jobs and aid localised, town centre economic growth. This could prove difficult, however, as the obtainability of brownfield sites in densely populated, residential areas is limited and is only likely to become more problematic

If unused land is hard to come by, the new, wider use classes could potentially help MFCs surface in our urban, town centre areas. As of 1 September, The Town and Country Planning (Use Classes) (Amendment) (England) Regulations 2020 came into force, amending the previously restrictive use class system. MFCs previously fell into use class A1 (retail warehouses). However, use class A1 has been abolished (along with use classes A2, A3 and B1). A retail warehouse use now falls into the new use class E (commercial, business, and service) - an amalgamation of the abolished A1, A2, A3 and B1 use classes. Change within use class E could then take place without planning permission.

This would allow retailers to repurpose a wide variety of uses into an MFC/retail warehouse use (subject to potential Local Planning Authority/landlord restrictions, and previous planning conditions). It would also be possible to convert part of a property to an MFC which, for example, is already being used by retailers as a shop/supermarket or office space.

Of course, building an MFC facility from scratch would require a planning application. Such an application would likely be hindered by local objections. The public see urban MFCs attracting more delivery vans to populated areas at all times of day, increasing carbon emissions and noise pollution. Residents are particularly aware of this if the application site is near schools or playgrounds/parks, for example.

Prior community engagement is key and, ultimately, Local Planning Authorities will have to consider whether the MFC proposal:

  • is environmentally sustainable;
  • complies with the Local Plan;
  • helps the high street; and
  • ensures design quality.

Servicing local needs via cargo e-bikes or offering click & collect in the heart of the community for customers to walk to would certainly help to counter this presumption, and arguably would present a far better option than diesel delivery vans visiting individual consumer households.

It remains to be seen whether the alteration to consumer habits due to COVID-19 will be lasting and thus warrant the anticipated retailer uptake in MFCs.

If you need any further guidance, please contact our retail solicitors.

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