Build-to-Rent Schemes

Dublin City Council (DCC) Chief Executive Owen Keegan has said that the “over-dominance” of Built-to-Rent (BTR) schemes in Dublin has become “unsustainable” with the potential to have “significant long-term adverse impacts on the housing needs of the city”. This is in response to the DCC’s observed trend of nearly all recent planning applications for apartment development being BTR schemes.

The Office of Planning Regulator (OPR) have recommended the removal of policies from the draft city Development Plan 2022 – 2028, including requiring a percentage of ‘standard build to sell apartments’ and discouraging BTR schemes of less than 100 units.

The current impasse between the OPR and DCC relates to the application of the Sustainable Urban Housing: Design Standards for New Apartments – Section 28 Guidelines (the 2020 Guidelines) in the draft development plan. In particular, Specific Planning Policy Requirement (SPPR) 8 prescribes that there should be “No restrictions on dwelling mix and all other requirements of these Guidelines shall apply, unless specified otherwise”

Recently the OPR has declined an invitation to a DCC meeting to explain the office’s recommendations on BTR schemes in the city. As can be seen from the OPR Submission on the draft development plan, the underlying rationale behind the OPR recommendations have been set out clearly, including:

1. Introducing a minimum unit level without any national or regional policy basis, or any other evidence basis. This is contrary to SPPR 8, which clearly sets out that there should be no restrictions.
2. Requiring 40% of units in a BTR scheme to be sold rather than rented. This is both ambiguous, arguably this could be interpreted as to be sold to individual purchasers only, and more importantly lacks national policy allowing for this, and
3. Allowing BTR applications to be assessed in line with the other parts of the 2020 Guidelines eg, internal design, layout and mix, is contrary to SPPR 8. SPPR 8 specifically states that these other parts of the Guidelines do not apply to BTR Development.

DCC have expressed disappointment that the OPR would not avail of the opportunity to explain their recommendations. It was claimed that such a meeting “could avoid a scenario where Dublin City Council could be forced to follow the path of Cork County Council costing the taxpayer even more money”, referring to the recent ruling against an OPR recommendation on the Cork County Development Plan.

However, there is significant difference when a local authority does not comply with a SPPR, as opposed to the obligation to ‘have regard to’ Section 28 Guidelines. In fact, what the Cork County Council case[1] highlighted was this specific difference. SPPRs contained in Section 28 guidelines are mandatory, but otherwise the duty in respect of Section 28 guidelines is to ‘have regard to them’, no more than that.

In the Cork County Council case, the court considered that by the OPR proceeding on the basis that the Council had not done what the guidelines envisage “and therefore” had failed to set out an overall strategy elevated the guidelines to a status that statute had made clear they do not have. The court regarded the reliance to Section 10(1A) of the PDA 2000 as entirely irrelevant because it only applied to guidelines that included SPPRs, as was not the case in this instance and remains contrary to the current DCC situation.

Section 12(18) of the PDA 2000 sets out the statutory obligations in relation to a local authority. It includes, the obligation to ensure that the development plan is consistent with the national and regional development objectives specified in national policy and SPPRs.

Section 28(1C) requires that planning authorities, regional assemblies and the Board shall, in the performance of their functions, comply with SPPRs. The OPR Submission reminded DCC of these statutory obligations. DCC will also need to ensure consistency with SPPR 8 when it determines a planning application, and the proposed DCC policies may introduce a conflict in that determination.

Despite the OPR pointing out these obligations, the DCC Chief Executive has recommended councillors press ahead with restrictions on the BTR schemes in the new Development Plan, on the basis that they are unsustainable.

In its Submission the OPR set out its full support of “the need to develop long-term, secure and sustainable housing which meets the diverse needs of people seeking accommodation in the city”. However, the OPR expressed the importance that this is provided for “in a manner that is supported by evidence, and consistent with both national policy and the policies of draft Plan itself”.

The OPR ultimately recommended DCC address the broad policy aim of sustainability and reducing the number of BTR Schemes, by focusing on and strengthening other requirements. These included:

• The introduction of reasonable performance-based criteria for the evaluation of communal facilities and services whilst having regard to national and regional policies, and
• For BTR applications to be assessed in line with other permitted BTR developments in the vicinity (3km) to demonstrate that the development would not result in the overconcentration of one housing tenure in a particular area.

If the OPR recommendations are not followed by DCC, as endorsed by the Chief Executive, the OPR may write to the Minister for Local Government and Planning under Section 31 of the PDA 2000 recommending a Ministerial Direction requiring compliance with the OPR recommendations. Recently the OPR wrote to the Minister in respect of Dun Laoghaire – Rathdown (DLR) County Development Plan 2022 – 2028 which was also recognised by the OPR as contrary to SPPR 8. The Minister informed DLR County Council of his intention to issue a Direction and they responded by amending the adopted Development plan in accordance with the OPR recommendations.

Conclusion

DCC’s position to date would indicate that the same response may not be forthcoming in this case, and they may decide to challenge any such Ministerial Direction by legal proceedings. DCC are due to consider this at a Special Council Meeting scheduled for early July, we await the outcome of this to see where this will lead.

For more information, contact a member of our Planning & Environment team.

The content of this article is provided for information purposes only and does not constitute legal or other advice.

[1] Cork County Council v Minister for Local Government and Planning & Ors High Court, Humphreys J, 5 November 2021, [2021] IEHC 683