The commercial property market is particularly diverse, a fact that makes it an excellent area of investment for people from all walks of life. Thanks to the variety on offer, our commercial property estate agents have seen investment in the sector grow increasingly popular in recent years.
Whether you’re about to make your first or 31st investment, our commercial estate agency provides guidance and support so you can start or expand your property portfolio with confidence and clarity. When buying a commercial property, exploring the market and the many different types of commercial property available in the UK provides a great place to begin.
To help you on your way to investment success, our commercial property estate agents are here to share their essential guide to the different types of commercial property in the UK.
What is a Commercial Property?
A commercial property is a property that is intended for business use rather than residential purposes. This includes office buildings, retail spaces, industrial facilities, warehouses, and hotels. These properties are typically leased to tenants for business activities and are often located in areas zoned for commercial or industrial use.
Introducing the five categories of commercial property in the UK
In the UK, commercial property is categorised as one of five property types, namely office, retail, industrial, leisure and healthcare. While the office category is fairly self-explanatory, the retail class comprises of shops, shopping centres and other retail stores. Industrial property includes but is not limited to warehouses and factories.
The leisure category is much more far-reaching, with hotels, pubs, cafes, restaurants and sports facilities all housed under this umbrella term. Healthcare properties are hospitals, GP surgeries, medical centres and nursing facilities.Â
Our commercial property estate agents are here to support you as you explore these commercial property types to identify the best investment for your budget and requirements.
An insight into the property classification system
In accordance with the Town and Country Planning (Use Classes) Order 1987, the five main categories detailed above are further broken down into classes. These classes are used by local councils to define how the commercial property type can be occupied and used.
More specifically referred to as ‘use classes’, these categories ensure that any commercial interests pursued or business carried out on the premises aligns with said property’s planning use.Â
If you, or your tenant, violate the commercial building’s use class, you may incur a fine. You can apply for a change of use to amend the commercial property’s class and conduct a different type of business on premises to operate within the law and avoid penalties. Â
How commercial properties are classified in the UK
The different property types our commercial estate agency assists with were traditionally classified from A to D. These use classifications have however recently been reconfigured and extended to include Class E, F1 and F2, but more on that later.
Category A commercial properties included shops (A1), financial and professional services (A2), food and drink outlets (A3), drinking establishments (A4), and hot food takeaways (A5).
Our commercial property estate agents also support clients with category B premises. These include category B1 buildings that are used for business purposes, such as offices that don’t provide financial or professional (A2) services; research and development studios, and laboratories used in any industrial process.Â
Classes B2 to B7 cover general industrial use, which can’t be categorised under the B1 use class. B8 commercial properties are used for storage or distribution. Category C properties included hotels and guest houses (C1); residential institutions such as boarding schools, care homes, nursing homes, residential colleges, and training centres (C2); and dwelling houses used by a single person, a family, up to six people living as a single household and in receipt of care, or up to six people living as a single household (C3).
A D2 commercial property can be used as an indoor or outdoor sports and leisure facility, whilst F1 (formerly known as D1) includes any non-residential institution. This includes churches and other places of worship, health clinics and centres, creches and nurseries, museums, public and community halls, libraries, art galleries, and other exhibition spaces.
In addition to the recently renamed F1 use class, changes to the 1987 Use Classes Order saw most of the use classes categorised as Class E to ensure a simplified system. An F2 class was also introduced as part of the regulation change. Class F2 has been designated for buildings for local community use, such as small shops, halls or meeting places, and indoor or outdoor recreational facilities.Â
A word about ‘sui-generis’ properties
There is another commercial property class that our commercial property estate agents should draw attention to. Sui-generises are a specialism of our commercial estate agency.Â
The term ‘sui-generis’ is used to classify any other commercial property that cannot be categorised from use class E to F2. This includes but is not limited to theatres, petrol stations, fun fairs, large houses of multiple occupancy (for groups of 7 people or more), scrapyards, nightclubs, laundrettes, taxi depots, police stations, casinos, and landfill sites.
Why use classes are important to the property landscape
As our commercial estate agency is keen to reiterate, use classes and the property classification system they make possible are crucial to the health of UK property stock.Â
Without use classes, planners can’t shape the landscape of specific areas or prevent specific property types from being included. Areas that are mainly residential for instance are likely to have a limited number of A4 properties (i.e. drinking establishments like pubs and bars) to minimise complaints from residents.
Use classes are utilised to determine which types of businesses can move into the property and the wider area.
Rory Mack Associates – the commercial estate agency
As specialist commercial property estate agents, we can assist you as you discover the different commercial property types available throughout Staffordshire, Cheshire and Shropshire.
Whether you need guidance on development appraisals, Capital Gains Tax or business rates, or require help with commercial sales and lettings, commercial valuations, building insurance assessments or property management, our commercial property estate agents can assist.
Contact our commercial estate agency today to discuss your requirements.
