We are often asked what else could I do with my farm buildings, particularly in recent weeks when all agricultural sectors seem to be struggling with low prices and high input costs.
Alternative income streams can provide a stable income to level out the undulations of farming activity and either give extra cash to invest in capital improvements, reduce borrowing or allow a business to be scaled back to reduce overheads whilst still providing income ahead of retirement.
Julie Branfield of Carver Knowles suggests: ‘If you are looking to alternatives now is an excellent time to review your options while borrowing rates remain low and the temporary permitted development rights for agricultural buildings allow flexible uses in a relatively straightforward manner’
Key things to consider when looking at alternatives:
- Planning – most changes of use from agriculture require some form of planning consent. The temporary Permitted Development rules allow up to 500m2 of agricultural building to be converted to other business uses with minimal requests from the local authority. The flexible uses include shops, offices, financial and professional services, cafes and restaurants, light industrial, storage, hotels and assembly and leisure. These permitted development rules come to an end in May 2016.
- Available buildings – Whilst traditional buildings attract the majority of conversions to dwellings, holiday accommodation or offices, most modern buildings can be adapted for commercial users as well. Whether it be caravan storage, secure self storage or as a restaurant, due to the robust nature of most modern buildings, they can be relatively easily converted.
- Capital available – When considering alternative businesses within the farm it is essential to consider the time and money required to operate a venture. Caravan storage for example requires some client management and possibly additional security measures, whereas a holiday cottage requires weekly management, advertising and generally an on site presence. If there is someone within the existing farm business wishing to start up their own craft business now is the time they can seek consent to use the farm premises lawfully.
- Infrastructure – When considering alternative users at a farm access and road links are an essential part of the planning process. If the access provided plenty of space and visibility for a grain wagon then it is probably good enough for most alternative uses, however it would need to be investigated. Along with roads in the modern age broadband is a must for any business user
- Designations – If the building is a Listed Building or Scheduled monument the Permitted Development provisions do not apply. However if you are in a Area of Outstanding Natural Beauty, Conservation Area or other designated site the Permitted development rules can be used. All development in these areas will be more sensitive but as this is building conversion rather than new development the fast track process should be used as much as possible.
When considering the key points of farm diversification it is important to take a step back and identify what your ultimate aim for the farm is; do you wish to have a temporary solution to provide income in the difficult times, are you aiming to wind down your operation as you head towards retirement, are you trying to generate some additional cashflow to meet the current debt servicing requirements
If you would like to a review of your farm buildings or assistance with the farm diversification process please do not hesitate to give us a call.