What will the M&S ruling mean for redevelopment?

COMMENT On 1 March, Mrs Justice Lieven handed down judgment in relation to the now-infamous battle between Marks & Spencer and the secretary of state as to proposals for M&S’ new flagship store on Oxford Street (Marks and Spencer plc v Secretary of State for Levelling Up, Housing and Communities and others [2024] EWHC 452 (Admin)). Last summer I wrote an article on the secretary of state’s decision and the ripples it would likely cause through the planning sector. In the short term, Lieven J’s judgment has helped clarify several important matters of policy interpretation. However, it is clearly not going to be the end of the M&S Oxford Street saga or wider debates regarding net zero and retrofit-first. The decision The key findings of the High Court case were as follows. The judge held that: The SoS’ statement that “there should generally be a strong presumption in favour of repurposing and reusing buildings, as reflected in paragraph 152 of the Framework” was a misinterpretation of the National Planning Policy Framework. The judge commented: “The SoS has not applied the policy, he has rewritten it.” The SoS failed to explain why he disagreed with his inspector’s conclusions that there was no viable and deliverable alternative to M&S’ proposed scheme. The SoS failed to grapple with the implications of refusal and the loss of the benefits of the scheme, which involved a departure from important development plan policies on a “principal important controversial issue”. The judge said: “Given that the SoS had given significant weight to the benefits of the scheme… his failure to adequately explain his approach to the loss of those benefits on refusal of the application is palpable.” The SoS failed to provide adequate reasons for finding, in disagreement with his inspector, that the harm to the vitality and viability of Oxford Street if the scheme (or an alternative) were not delivered would be “limited”. The judge said: “If the SoS was going to disagree on such a basic point arising from the policy background and the inspector’s conclusions, then he had to explain that clearly.” The SoS made a clear error of fact and an even clearer error in the interpretation of the policy on carbon. The judge said the SoS “appears to have become thoroughly confused on this point and has assumed the requirement for carbon offsetting applied to embodied carbon and not just operational carbon”. In a press release following the decision, M&S stated: “The result has been a long, unnecessary and costly delay to the only retail-led regeneration on Oxford Street which would deliver one of London’s greenest buildings, create thousands of new jobs and rejuvenate the capital’s premier shopping district. “The secretary of state now has the power to unlock the wide-ranging benefits of this significant investment and send a clear message to UK and global business that the government supports sustainable growth and the regeneration of our towns and cities.” The implications A debatable positive of the case is that policies are now likely to be introduced more rapidly to provide greater certainty as to what will be required to justify retrofit over refurbishment and checks in relation to embodied carbon. The obvious flip side being it is likely to become ever harder to justify demolition and rebuild where retrofit is feasible, even where more commercially attractive options exist. With Westminster City Council’s partial review of its City Plan, which includes its new “retrofit-first” policies, now in full swing, and with the possibility of the secretary of state updating the NPPF ahead of the redetermination, it is likely the policy framework will be clearer even before the M&S redetermination takes place.  For schemes immediately dealing with similar issues, the decision is unlikely to dramatically change the current approach of “scraping the barrel” in terms of clearly setting out the viability of alternatives, including carbon optioneering, when proposing to redevelop instead of refurbishing. For those proposing demolition over retrofit, it will be critical to establish that no meaningful refurbishment could be delivered that could also achieve the public benefits sought by development plan policies. The redetermination The M&S redetermination will still turn on the same crucial issues of harm to the significance of heritage assets, alternatives to demolition (including carbon issues) and the weighting of the public benefits of the scheme.  It will be interesting to see how the SoS deals with factors relating to the vitality and viability of Oxford Street and the West End in the new decision. The appeal planning inspector, David Nicholson, deemed that refusal of the scheme would be against central development plan policies aimed at improving the Oxford Street area; however, the SoS found the harm he had identified was overstated and limited. The High Court judgment places significant doubt that the SoS’ conclusion could be sustained on redetermination, noting the obvious strong development plan support and the harm from the loss of opportunity which would flow from the refusal of the application.  It will also be interesting to see whether the SoS takes a different approach in terms of his findings in relation to overall compliance with the development plan. It is a fascinating case study of when the planning system meets commercial realities – it remains to be seen whether the former can sensibly accommodate the latter in the next chapter. Chris Todman is a senior associate at Town Legal LLP READ MORE: Practice point – Relevant policies must back up repurposing and embodied carbon considerations Photo © Story Picture Agency/Shutterstock (13608364d)